10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

x     QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal period ended: September 30, 2015

oTRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from --- to ---

Commission File Number: 000-31810

___________________________________

Cinedigm Corp.

(Exact name of registrant as specified in its charter)

___________________________________

Delaware	22-3720962
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
902 Broadway, 9th Floor New York, NY	10010
(Address of principal executive offices)	(Zip Code)

(212) 206-8600

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each class	Name of each exchange on which registered
CLASS A COMMON STOCK, PAR VALUE $0.001 PER SHARE	NASDAQ GLOBAL MARKET
Securities registered pursuant to Section 12(g) of the Act:	NONE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.	Yes x No o
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).	Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  o	Accelerated filer  x	Non-accelerated filer  o	Smaller reporting company o
		(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).				Yes o No x

As of November 4, 2015, 75,085,433 shares of Class A Common Stock, $0.001 par value were outstanding, which number includes 11,791,384 shares subject to our forward purchase transaction and excludes 2,772,440 shares held in treasury.

CINEDIGM CORP.

TABLE OF CONTENTS

		Page
PART I --	FINANCIAL INFORMATION
Item 1.	Financial Statements (Unaudited)	3
	Condensed Consolidated Balance Sheets at September 30, 2015 (Unaudited) and March 31, 2015	3
	Unaudited Condensed Consolidated Statements of Operations for the Three and Six Months ended September 30, 2015 and 2014	4
	Unaudited Condensed Consolidated Statements of Comprehensive Loss for the Three and Six Months ended September 30, 2015 and 2014	5
	Unaudited Condensed Consolidated Statements of Cash Flows for the Six Months ended September 30, 2015 and 2014	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	26
Item 4.	Controls and Procedures	41
PART II --	OTHER INFORMATION	41
Item 1.	Legal Proceedings	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	41
Item 3.	Defaults Upon Senior Securities	41
Item 4.	Mine Safety Disclosures	41
Item 5.	Other Information	41
Item 6.	Exhibits	41
Signatures		43
Exhibit Index		44

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

CINEDIGM CORP.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except for share and per share data)

	September 30, 2015			March 31, 2015
ASSETS	(Unaudited)
Current assets
Cash and cash equivalents	$	18,963		$	18,999
Accounts receivable, net of allowance for doubtful accounts of $936 and $597, respectively	64,867			59,591
Inventory	2,938			3,210
Unbilled revenue	4,096			5,065
Prepaid and other current assets	18,714			20,078
Total current assets	109,578			106,943
Restricted cash	8,983			6,751
Property and equipment, net	80,826			98,561
Intangible assets, net	28,865			31,784
Goodwill	8,701			26,701
Other assets	1,953			2,277
Total assets	$	238,906		$	273,017
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities
Accounts payable and accrued expenses	$	75,817		$	77,147
Current portion of notes payable, non-recourse (see Note 5)	30,840			32,973
Current portion of notes payable	—			24,294
Current portion of capital leases	673			640
Current portion of deferred revenue	2,629			2,760
Total current liabilities	109,959			137,814
Notes payable, non-recourse, net of current portion and unamortized debt issuance costs of $5,164 and $5,938, respectively (see Note 5)	101,555			118,387
Notes payable, net of current portion and unamortized debt issuance costs of $3,392 and $750, respectively	79,667			21,000
Capital leases, net of current portion	4,520			4,855
Deferred revenue, net of current portion	9,274			10,098
Total liabilities	304,975			292,154
Stockholders’ deficit
Preferred stock, 15,000,000 shares authorized; Series A 10% - $0.001 par value per share; 20 shares authorized; 7 shares issued and outstanding at September 30, 2015 and March 31, 2015, respectively. Liquidation preference of $3,648	3,559			3,559
Common stock, $0.001 par value; Class A and Class B stock; Class A stock 210,000,000 stock authorized; 77,857,873 and 77,178,494 stock issued and 75,085,433 and 77,075,614 stock outstanding at September 30, 2015 and March 31, 2015, respectively; 1,241,000 Class B stock authorized and issued and zero stock outstanding at September 30, 2015 and March 31, 2015, respectively	78			77
Additional paid-in capital	267,660			277,984
Treasury stock, at cost; 2,772,440 and 51,440 Class A common shares at September 30, 2015 and March 31, 2015, respectively	(2,839		)	(172		)
Accumulated deficit	(333,746		)	(300,350		)
Accumulated other comprehensive loss	(27		)	(57		)
Total stockholders’ deficit of Cinedigm Corp.	(65,315		)	(18,959		)
Deficit attributable to noncontrolling interest	(754		)	(178		)
Total deficit	(66,069		)	(19,137		)
Total liabilities and stockholders' deficit	$	238,906		$	273,017

See accompanying notes to Condensed Consolidated Financial Statements

3

CINEDIGM CORP.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except for share and per share data)

	Three Months Ended September 30,						Six Months Ended September 30,
	2015			2014			2015			2014
Revenues	$	27,704		$	23,721		$	50,532		$	46,578
Costs and expenses:
Direct operating (excludes depreciation and amortization shown below)	8,388			3,311			15,680			11,815
Selling, general and administrative	9,509			8,213			18,327			15,811
Provision for doubtful accounts	—			78			339			172
Restructuring, transition and acquisition expenses, net	63			817			196			1,763
Goodwill impairment	18,000			—			18,000			—
Litigation settlement recovery, net of expenses	(1,208		)	91			(410		)	202
Depreciation and amortization of property and equipment	9,427			9,391			18,784			18,767
Amortization of intangible assets	1,463			1,464			2,922			3,349
Total operating expenses	45,642			23,365			73,838			51,879
Income (loss) from operations	(17,938		)	356			(23,306		)	(5,301		)
Interest expense, net	(5,192		)	(4,993		)	(10,322		)	(10,028		)
Loss on extinguishment of debt	—			—			(931		)	—
Other income (expense), net	124			(39		)	232			100
Change in fair value of interest rate derivatives	(68		)	84			(66		)	(175		)
Loss from continuing operations	(23,074		)	(4,592		)	(34,393		)	(15,404		)
Income from discontinued operations	—			293			—			442
Loss on sale of discontinued operations	—			(3,045		)	—			(3,045		)
Net loss	(23,074		)	(7,344		)	(34,393		)	(18,007		)
Net loss attributable to noncontrolling interest	741			—			1,175			—
Net loss attributable to controlling interests	(22,333		)	(7,344		)	(33,218		)	(18,007		)
Preferred stock dividends	(89		)	(89		)	(178		)	(178		)
Net loss attributable to common stockholders	$	(22,422	)	$	(7,433	)	$	(33,396	)	$	(18,185	)
Net loss per Class A and Class B common stock attributable to common stockholders - basic and diluted:
Loss from continuing operations	$	(0.35	)	$	(0.06	)	$	(0.51	)	$	(0.20	)
Loss from discontinued operations	—			(0.04		)	—			(0.03		)
Net loss attributable to common stockholders	$	(0.35	)	$	(0.10	)	$	(0.51	)	$	(0.23	)
Weighted average number of Class A and Class B common stock outstanding: basic and diluted	63,236,908			76,748,753			65,200,093			76,659,162

See accompanying notes to Condensed Consolidated Financial Statements

4

CINEDIGM CORP.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(Unaudited)

(In thousands)

	For the Three Months Ended September 30,						For the Six Months Ended September 30,
	2015			2014			2015			2014
Net loss	$	(23,074	)	$	(7,344	)	$	(34,393	)	$	(18,007	)
Other comprehensive income (loss): foreign exchange translation	32			(54		)	30			2
Comprehensive loss	(23,042		)	(7,398		)	(34,363		)	(18,005		)
Less: comprehensive loss attributable to noncontrolling interest	741			—			1,175			—
Comprehensive loss attributable to controlling interests	$	(22,301	)	$	(7,398	)	$	(33,188	)	$	(18,005	)

See accompanying notes to Condensed Consolidated Financial Statements

5

CINEDIGM CORP.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

	For the Six Months Ended September 30,
	2015			2014
Cash flows from operating activities:
Net loss	$	(34,393	)	$	(18,007	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Loss on disposal of business	—			3,045
Depreciation and amortization of property and equipment and amortization of intangible assets	21,706			22,116
Goodwill impairment	18,000			—
Amortization of debt issuance costs included in interest expense	1,203			886
Provision for doubtful accounts	339			172
Provision for inventory reserve	500			900
Stock-based compensation and expenses	1,073			1,073
Change in fair value of interest rate derivatives	66			175
Accretion and PIK interest expense added to note payable	1,124			1,222
Loss on extinguishment of debt	931			—
Changes in operating assets and liabilities, net of acquisitions and dispositions:
Accounts receivable	(5,562		)	(17,743		)
Inventory	(228		)	(921		)
Unbilled revenue	969			2,072
Prepaid expenses and other assets	1,287			(8,853		)
Accounts payable, accrued expenses and other liabilities	(1,434		)	17,667
Deferred revenue	(955		)	(1,257		)
Net cash provided by operating activities	4,626			2,547
Cash flows from investing activities:
Contributions from noncontrolling interest	599			—
Purchases of property and equipment	(1,049		)	(620		)
Purchases of intangible assets	(3		)	(6		)
Proceeds from sale of business	—			2,950
Additions to capitalized software costs	—			(855		)
Net cash (used in) provided by investing activities	(453		)	1,469
Cash flows from financing activities:
Payment of notes payable	(38,820		)	(29,115		)
Net (repayments) borrowings under revolving credit agreement	(9,167		)	5,000
Proceeds from issuance of 5.5% Convertible Notes	64,000			—
Payment for structured stock repurchase forward contract	(11,440		)	—
Repurchase of Class A common stock	(2,667		)	—
Principal payments on capital leases	(302		)	(298		)
Payments of debt issuance costs	(3,581		)	—
Restricted cash	(2,232		)	—
Costs associated with issuance of Class A common stock	—			(72		)
Net cash used in financing activities	(4,209		)	(24,485		)
Net change in cash and cash equivalents	(36		)	(20,469		)
Cash and cash equivalents at beginning of period	18,999			50,215
Cash and cash equivalents at end of period	$	18,963		$	29,746

See accompanying notes to Condensed Consolidated Financial Statements

6

CINEDIGM CORP.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. NATURE OF OPERATIONS

Cinedigm Corp. was incorporated in Delaware on March 31, 2000 (“Cinedigm”, and collectively with its subsidiaries, the “Company,” "we," "us," or similar pronouns). We are (i) a leading distributor and aggregator of independent movie, television and other short form content, managing a distribution rights library of close to 50,000 titles and episodes released across digital, physical, theatrical, home and mobile entertainment platforms and (ii) a leading servicer of digital cinema assets on more than 12,000 movie screens in both North America, Australia and New Zealand.

We report our financial results in the following reportable segments: (1) the first digital cinema deployment (“Phase I Deployment”), (2) the second digital cinema deployment (“Phase II Deployment”), (3) digital cinema services (“Services”) and (4) media content and entertainment group (“Content & Entertainment” or "CEG"). The Phase I Deployment and Phase II Deployment segments are the financing vehicles and administrators for our digital cinema equipment (the “Systems”) installed in movie theatres throughout the United States, and in Australia and New Zealand, which are non-recourse to the other segments of our business. Our Services segment provides fee based support to more than 12,000 movie screens in our Phase I Deployment and Phase II Deployment segments as well as directly to exhibitors and other third party customers in the form of monitoring, billing, collections and verification services. Our Content & Entertainment segment is focused on: (1) ancillary market aggregation and distribution of entertainment content, and (2) branded and curated over-the-top ("OTT") digital network business providing entertainment channels and applications. We are structured so that our digital cinema business (collectively, the Phase I Deployment, Phase II Deployment and Services segments) operates independently from our Content & Entertainment segment.

Investments in which we do not have a controlling interest or are not the primary beneficiary but have the ability to exert significant influence, are accounted for under the equity method of accounting. Noncontrolling interests for which we have been determined to have a controlling financial interest are consolidated and recorded net of tax as net income (loss) attributable to noncontrolling interest. See Note 4 - Other Interests to the Condensed Consolidated Financial Statements for a discussion of our noncontrolling interests.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION AND CONSOLIDATION

We have incurred net losses historically and have an accumulated deficit of $333.7 million as of September 30, 2015. We also have significant contractual obligations related to our recourse and non-recourse debt for the remainder of the fiscal year ending March 31, 2016 and beyond. We may continue to generate net losses for the foreseeable future. We believe the combination of: (i) our cash and restricted cash balances at September 30, 2015, (ii) the remaining availability under our revolving line of credit, (iii) planned cost reduction initiatives, and (iv) expected cash flows from operations will be sufficient to satisfy our liquidity and capital requirements for the next twelve months. Our capital requirements will depend on many factors, and we may need to use available capital resources and raise additional capital. As a result of our ongoing process of exploring and evaluating potential significant strategic and capital raising opportunities with the help of our financial advisor, we are in discussions with a potential investor to help meet our ongoing capital raising requirements. There can be no assurance that the transaction under discussion will be consummated. Failure to generate additional revenues, raise additional capital or manage discretionary spending could have an adverse effect on our financial position, results of operations or liquidity.

The accompanying Condensed Consolidated Financial Statements are unaudited and include the accounts of the Company, its wholly owned subsidiaries and subsidiaries in which it has a controlling interest, and reflect all normal and recurring adjustments necessary for the fair presentation of its financial position, results of operations and cash flows. All material inter-company accounts and transactions have been eliminated in consolidation.

We have reclassified certain amounts previously reported in our financial statements to conform to the current presentation. Effective September 30, 2015, we elected to change our method of presentation relating to debt issuance costs in accordance with Financial Accounting Standards Board ("FASB") ASU 2015-03 - Simplifying the Presentation of Debt Issuance Costs.  Prior to September 30, 2015, our policy was to present debt issuance costs in Other Assets on the Condensed Consolidated Balance Sheets, net of accumulated amortization. Beginning with the period ended September 30, 2015, we have presented these costs as a direct deduction to notes payable. Unamortized debt issuance costs of $6.7 million previously reported as assets on our Consolidated Balance Sheet as of March 31, 2015 have been reclassified as a direct deduction to notes payable.

7

USE OF ESTIMATES

The preparation of these Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires us to make estimates and assumptions that affect the amounts reported in these Condensed Consolidated Financial Statements and accompanying notes. As permitted under GAAP, interim accounting for certain expenses, such as the adequacy of accounts receivable reserves, return reserves, inventory reserves, recoupment of advances, minimum guarantees, assessment of goodwill and intangible asset impairment and valuation reserve for income taxes, are based on full year assumptions when appropriate. Actual results could differ materially from those estimates.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"), although we believe that the disclosures are adequate to make the information presented not misleading. The results of operations for the respective interim periods are not necessarily indicative of the results expected for the full year. These Condensed Consolidated Financial Statements and accompanying notes should be read in conjunction with our annual consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2015.

CASH AND CASH EQUIVALENTS

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. We maintain bank accounts with major banks, which from time to time may exceed the Federal Deposit Insurance Corporation’s insured limits. We periodically assess the financial condition of the institutions and believe that the risk of any loss is minimal.

ACCOUNTS RECEIVABLE

We maintain reserves for potential credit losses on accounts receivable. We review the composition of accounts receivable and analyze historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.

Our Content & Entertainment segment recognizes accounts receivable, net of an estimated allowance for product returns and customer chargebacks, at the time that it recognizes revenue from a sale. We base the amount of the returns allowance and customer chargebacks upon historical experience and future expectations.

We record accounts receivable, long-term in connection with activation fees that we earn from Systems deployments that have extended payment terms. Such accounts receivable are discounted to their present value at prevailing market rates and are recorded as other assets in the Condensed Consolidated Balance Sheets.

ADVANCES

Advances are recorded within prepaid and other current assets within the Condensed Consolidated Balance Sheets and represent amounts prepaid to studios or content producers for which we provide content distribution services. We evaluate advances regularly for recoverability and record charges for amounts that we expect may not be recoverable as of the balance sheet date.

INVENTORY

Inventory consists of finished goods of Company owned, physical DVD and Blu-ray Disc titles and is stated at the lower of cost (determined based on weighted average cost) or market. We identify inventory items to be written down for obsolescence based on their sales status and condition. We write down discontinued or slow moving inventories based on an estimate of the markdown to retail price needed to sell through our current stock level of the inventories.

RESTRICTED CASH

Our 2013 Term Loans, Prospect Loan and Cinedigm Credit Agreement require that we maintain specified cash balances that are restricted to repayment of interest (see Note 5 - Notes Payable).

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation expense is recorded using the straight-line method over the estimated useful lives of the respective assets as follows:

8

Computer equipment and software	3 - 5 years
Digital cinema projection systems	10 years
Machinery and equipment	3 - 10 years
Furniture and fixtures	3 - 6 years

Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the leasehold improvements. Repair and maintenance costs are charged to expense as incurred. Major renewals, improvements and additions are capitalized. Upon the sale or other disposition of any property and equipment, the cost and related accumulated depreciation and amortization are removed from the accounts and the gain or loss on disposal is included in the Condensed Consolidated Statements of Operations.

ACCOUNTING FOR DERIVATIVE ACTIVITIES

Derivative financial instruments are recorded at fair value. Changes in the fair value of derivative financial instruments are either recognized in accumulated other comprehensive loss (a component of stockholders' deficit) or in the Condensed Consolidated Statements of Operations depending on whether the derivative qualifies for hedge accounting. We have entered into two separate interest rate cap transactions to limit our exposure to interest rates related to our 2013 Term Loans and Prospect Loan. The interest rate caps on the 2013 Term Loans and Prospect Loan mature in March of 2016 and 2018, respectively. We have not sought hedge accounting treatment for these instruments and therefore, changes in the value of our interest rate derivatives were recorded in the Condensed Consolidated Statements of Operations.

FAIR VALUE MEASUREMENTS

The fair value measurement disclosures are grouped into three levels based on valuation factors:

• Level 1 – quoted prices in active markets for identical investments

• Level 2 – other significant observable inputs (including quoted prices for similar investments and market corroborated inputs)

• Level 3 – significant unobservable inputs (including our own assumptions in determining the fair value of investments)

Assets and liabilities measured at fair value on a recurring basis use the market approach, where prices and other relevant information are generated by market transactions involving identical or comparable assets or liabilities.

The following tables summarize the levels of fair value measurements of our financial assets and liabilities:

	As of September 30, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	8,983	$	—	$	—	$	8,983
Interest rate derivatives	—		172		—		172
	$	8,983	$	172	$	—	$	9,155

	As of March 31, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	6,751	$	—	$	—	$	6,751
Interest rate derivatives	—		208		—		208
	$	6,751	$	208	$	—	$	6,959

Our cash and cash equivalents, accounts receivable, unbilled revenue and accounts payable and accrued expenses are financial instruments and are recorded at cost in the Condensed Consolidated Balance Sheets. The estimated fair values of these financial instruments approximate their carrying amounts because of their short-term nature.  The carrying amount of accounts receivable, long-term and notes receivable approximates fair value based on the discounted cash flows of such instruments using current assumptions at the balance sheet date. At September 30, 2015 and March 31, 2015, the estimated fair value of our fixed rate debt approximated its carrying amounts. We estimated the fair value of debt based upon current interest rates available to us at the respective balance sheet dates for arrangements with similar terms and conditions. Based on borrowing rates currently available to us for loans with similar terms, the carrying value of notes payable and capital lease obligations approximates fair value.

9

IMPAIRMENT OF LONG-LIVED AND FINITE-LIVED ASSETS

We review the recoverability of our long-lived assets and finite-lived intangible assets, when events or conditions occur that indicate a possible impairment exists. The assessment for recoverability is based primarily on our ability to recover the carrying value of our long-lived and finite-lived assets from expected future undiscounted net cash flows. If the total of expected future undiscounted net cash flows is less than the total carrying value of the asset, the asset is deemed not to be recoverable and possibly impaired. We then estimate the fair value of the asset to determine whether an impairment loss should be recognized. An impairment loss will be recognized if the asset's fair value is determined to be less than its carrying value. Fair value is determined by computing the expected future discounted cash flows. During the six monthsended September 30, 2015 and 2014, no impairment charge was recorded from continuing operations for long-lived assets or finite-lived assets.

GOODWILL

Goodwill is the excess of the purchase price paid over the fair value of the net assets of an acquired business. Goodwill is tested for impairment on an annual basis at the end of the fourth quarter of each fiscal year, or more often if warranted by events or changes in circumstances indicating that the carrying value of a reporting unit may exceed fair value, also known as impairment indicators. Our process of evaluating goodwill for impairment involves the determination of fair value of goodwill compared to its carrying value. Our only reporting unit with goodwill is our Content & Entertainment reporting unit, which had a goodwill carrying value that was materially derived from our October 2013 acquisition of a division of Gaiam, Inc. and Gaiam Americas, Inc. (the "GVE acquisition").

Inherent in the fair value determination for each reporting unit are certain judgments and estimates relating to future cash flows, including management’s interpretation of current economic indicators and market conditions, and assumptions about our strategic plans with regard to its operations. To the extent additional information arises, market conditions change or our strategies change, it is possible that the conclusion regarding whether our remaining goodwill is impaired could change and result in future goodwill impairment charges that will have a material effect on our consolidated financial position or results of operations.

As a result of factors discussed in detail below, we performed a quantitative fair value assessment for our CEG reporting unit as of September 30, 2015, and determined that the reporting unit had a fair value less than its carrying amount. As a result, we recorded a goodwill impairment charge of $18.0 million for the three months and six months ended September 30, 2015. In determining fair value we used various assumptions, including expectations of future cash flows based on projections or forecasts derived from analysis of business prospects, economic or market trends and any regulatory changes that may occur. We estimated the fair value of the reporting unit using a net present value methodology, which is dependent on significant assumptions related to estimated future discounted cash flows, discount rates and tax rates. The assumptions used in our goodwill impairment tests should not be construed as earnings guidance or long-term projections. Our cash flow assumptions are based on a 5-year internal projection of adjusted EBITDA for the Content & Entertainment reporting unit. We assumed a market-based weighted average cost of capital of 17% to discount cash flows for our CEG segment and used a blended federal and state tax rate of 40%.

We reassessed the fair value of our CEG reporting unit in the second quarter of 2015 because the reporting unit is expected to perform below the fiscal year 2016 forecast that we had established during our annual testing of goodwill at March 31, 2015. The Company faced challenges in the first half of fiscal 2016 that significantly impacted our ability to establish the new contracts, customer relationships and OTT channels that we had originally anticipated and shifted a portion of management's focus away from business operations. As a result, our fiscal 2016 projections for revenue and adjusted EBITDA are expected to fall materially below our original estimates, particularly those for the second half of the fiscal year. Future decreases in the fair value of our CEG reporting unit may require us to record additional goodwill impairment, particularly if our expectations of future cash flows are not achieved.

Information related to the goodwill allocated to our Content & Entertainment segment is as follows:

(In thousands)	Goodwill
As of March 31, 2015	$	26,701
Goodwill impairment	(18,000		)
As of September 30, 2015	$	8,701

Gross amounts of goodwill and accumulated impairment charges that we have recorded are as follows:

10

(In thousands)	Goodwill
Goodwill	$	32,701
Accumulated impairment losses	(24,000		)
Net goodwill at September 30, 2015	$	8,701

No goodwill impairment charge was recorded in the six months ended September 30, 2014.

PARTICIPATIONS AND ROYALTIES PAYABLE

We record liabilities within accounts payable and accrued expenses on the Condensed Consolidated Balance Sheet, that represent amounts owed to studios or content producers for royalties owed under licensing arrangements when we provide content distribution services. We identify and record as a reduction to the liability any expenses that are to be reimbursed to us by such studios or content producers.

DEBT ISSUANCE COSTS

We incur debt issuance costs in connection with long-term debt financings. Such costs are recorded as a direct deduction to notes payable and amortized over the terms of the respective debt obligations using the effective interest rate method (see Note 5 - Notes Payable). Debt issuance costs recorded in connection with revolving debt arrangements are presented in other assets on the Condensed Consolidated Balance Sheets and are amortized over the term of the revolving debt agreements using the effective interest rate method.

REVENUE RECOGNITION

Phase I Deployment and Phase II Deployment

Virtual print fees (“VPFs”) are earned, net of administrative fees, pursuant to contracts with movie studios and distributors, whereby amounts are payable by a studio to Phase 1 DC and to Phase 2 DC when movies distributed by the studio are displayed on screens utilizing our Systems installed in movie theatres. VPFs are earned and payable to Phase 1 DC based on a defined fee schedule with a reduced VPF rate year over year until the sixth year at which point the VPF rate remains unchanged through the tenth year, at which point the VPFs phase out.  One VPF is payable for every digital title displayed per System. The amount of VPF revenue is dependent on the number of movie titles released and displayed using the Systems in any given accounting period. VPF revenue is recognized in the period in which the digital title first plays on a System for general audience viewing in a digitally-equipped movie theatre, as Phase 1 DC’s and Phase 2 DC’s performance obligations have been substantially met at that time. Beginning in December 2015, certain Phase 1 DC Systems will have reached the conclusion of their deployment payment period. In accordance with existing agreements with distributors, a substantial portion of VPF revenues will cease to be recognized on such Systems. Because the Phase I deployment installation period ended in November 2007, a majority of the VPF revenue associated with the Phase I systems will end by November 2017. While the absence of such revenue is not expected to be material to the Condensed Consolidated Statements of Operations during the fiscal year ending March 31, 2016, it is expected to have a material cumulative impact in subsequent periods.

Phase 2 DC’s agreements with distributors require the payment of VPFs, according to a defined fee schedule, for ten years from the date each system is installed; however, Phase 2 DC may no longer collect VPFs once “cost recoupment,” as defined in the agreements, is achieved.  Cost recoupment will occur once the cumulative VPFs and other cash receipts collected by Phase 2 DC have equaled the total of all cash outflows, including the purchase price of all Systems, all financing costs, all “overhead and ongoing costs”, as defined, and including service fees, subject to maximum agreed upon amounts during the three-year rollout period and thereafter.  Further, if cost recoupment occurs before the end of the eighth contract year, the studio will pay us a one-time “cost recoupment bonus”. Any other cash flows, net of expenses, received by Phase 2 DC following the achievement of cost recoupment are required to be returned to the distributors on a pro-rata basis. At this time, the Company cannot estimate the timing or probability of the achievement of cost recoupment. Beginning in December 2018, certain Phase 2 DC Systems will have reached the conclusion of their deployment payment period, subject to earlier achievement of cost recoupment. In accordance with existing agreements with distributors, VPF revenues will cease to be recognized on such Systems. Because the Phase II deployment installation period ended in December 2012, a majority of the VPF revenue associated with the Phase I systems will end by December 2022 or earlier if cost recoupment is achieved.

Alternative content fees (“ACFs”) are earned pursuant to contracts with movie exhibitors, whereby amounts are payable to Phase 1 DC and to Phase 2 DC, generally either a fixed amount or as a percentage of the applicable box office revenue derived from the

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exhibitor’s showing of content other than feature movies, such as concerts and sporting events (typically referred to as “alternative content”). ACF revenue is recognized in the period in which the alternative content first opens for audience viewing.

Revenues earned in connection with up front exhibitor contributions are deferred and recognized over the expected cost recoupment period.

Services

Exhibitors who purchased and own Systems using their own financing in the Phase II Deployment paid us an upfront activation fee that is generally $2.0 thousand per screen (the “Exhibitor-Buyer Structure”). These upfront activation fees are recognized in the period in which these Systems were delivered and are ready for content, as we had no further obligations to the customer after that time and collection was reasonably assured. In addition, we recognize activation fee revenue of between $1.0 thousand and $2.0 thousand on Phase 2 DC Systems and for Systems installed by CDF2 Holdings (See Note 4 - Other Interests) upon installation and such fees are generally collected upfront upon installation. Our services segment manages and collects VPFs on behalf of exhibitors, for which it earns an administrative fee equal to 10% of the VPFs collected.

Our Services segment earns an administrative fee of approximately 5% of VPFs collected and, in addition, earns an incentive service fee equal to 2.5% of the VPFs earned by Phase 1 DC. This administrative fee is recognized in the period in which the billing of VPFs occurs, as performance obligations have been substantially met at that time.

Content & Entertainment

CEG earns fees for the distribution of content in the home entertainment markets via several distribution channels, including digital, VOD, and physical goods (e.g., DVD and Blu-ray Discs). Fees earned are typically based on the gross amounts billed to our customers less the amounts owed to the media studios or content producers under distribution agreements, and gross media sales of owned or licensed content. Depending upon the nature of the agreements with the platform and content providers, the fee rate that we earn varies. Generally, revenues are recognized when content is available for subscription on the digital platform, at the time of shipment for physical goods, or point-of-sale for transactional and VOD services. Reserves for sales returns and other allowances are recorded based upon historical experience. If actual future returns and allowances differ from past experience, adjustments to our allowances may be required. Sales returns and allowances are reported as a reduction of revenues.

CEG also has contracts for the theatrical distribution of third party feature movies and alternative content. CEG’s distribution fee revenue and CEG's participation in box office receipts is recognized at the time a feature movie and alternative content are viewed. CEG has the right to receive or bill a portion of the theatrical distribution fee in advance of the exhibition date, and therefore such amount is recorded as a receivable at the time of execution, and all related distribution revenue is deferred until the theatrical release date of the third party feature movie or alternative content.

DIRECT OPERATING COSTS

Direct operating costs primarily consist of operating costs such as cost of goods sold, fulfillment expenses, shipping costs, royalty expenses, participation expenses, marketing and direct personnel costs.

STOCK-BASED COMPENSATION

Employee and director stock-based compensation expense from continuing operations related to our stock-based awards was as follows:

	For the Three Months Ended September 30,				For the Six Months Ended September 30,
(In thousands)	2015		2014		2015		2014
Direct operating	$	4	$	3	$	10	$	6
Selling, general and administrative	397		404		1,063		1,019
	$	401	$	407	$	1,073	$	1,025

The weighted-average grant-date fair value of options granted during the three monthsended September 30, 2015 and 2014 was $0.35 and $1.09, respectively, and $0.52 and $1.27 for the six months ended September 30, 2015 and 2014, respectively. There were zero and 6,673 stock options exercised during the three monthsended September 30, 2015 and September 30, 2014, res

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pectively, and 25,000 and 41,066 stock options exercised for the six months ended September 30, 2015 and 2014, respectively.

We estimated the fair value of stock options at the date of each grant using a Black-Scholes option valuation model with the following assumptions:

	For the Three Months Ended September 30,		For the Six Months Ended September 30,
Assumptions for Option Grants	2015	2014	2015	2014
Range of risk-free interest rates	1.5% - 1.6%	1.6 - 1.8%	1.4% - 1.7%	1.6 - 1.8%
Dividend yield	—	—	—	—
Expected life (years)	5	5	5	5
Range of expected volatilities	70.7 - 70.7%	71.4 - 71.5%	70.6 - 70.9%	71.4 - 72.3%

The risk-free interest rate used in the Black-Scholes option pricing model for options granted under our stock option plan awards is the historical yield on U.S. Treasury securities with equivalent remaining lives. We do not currently anticipate paying any cash dividends on common stock in the foreseeable future. Consequently, an expected dividend yield of zero is used in the Black-Scholes option pricing model.  We estimate the expected life of options granted under our stock option plans using both exercise behavior and post-vesting termination behavior, as well as consideration of outstanding options. We estimate expected volatility for options granted under our stock option plans based on a measure of our Class A common stock's historical volatility in the trading market.

NET LOSS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS

Basic and diluted net loss per common share has been calculated as follows:

Basic and diluted net loss per common share attributable to common stockholders =	Net loss attributable to common stockholders
	Weighted average number of common stock  outstanding during the period

Stock issued and treasury stock repurchased during the period are weighted for the portion of the period that they are outstanding. The shares to be repurchased in connection with the forward stock purchase transaction discussed in Note 6 - Stockholders' Deficit are considered repurchased for the purposes of calculating earnings per share and therefore the calculation of weighted average shares outstanding as of September 30, 2015 excludes approximately 11.8 million shares that will be repurchased as a result of the forward stock purchase transaction.

Loss per share from continuing operations is calculated similarly to basic and diluted loss per common share attributable to common shareholders, except that it uses loss from continuing operations in the numerator and takes into account the net loss attributable to noncontrolling interest.

We incurred net losses for each of the three months and six monthsended September 30, 2015 and 2014, and therefore the impact of potentially dilutive common shares from outstanding stock options and warrants, totaling 29,135,181 shares and 29,113,797 shares as of September 30, 2015 and 2014, respectively, were excluded from the computation of earnings per share as their impact would have been anti-dilutive.

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the FASB issued new accounting guidance on revenue recognition. The new standard provides for a single five-step model to be applied to all revenue contracts with customers as well as requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. Companies have an option to use either a retrospective approach or cumulative effect adjustment approach to implement the standard. The guidance will be effective during our fiscal year ending March 31, 2019 with early adoption permitted. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In June 2014, the FASB issued an accounting standards update, which provides additional guidance on how to account for share-based payments where the terms of an award may provide that the performance target could be achieved after an employee completes the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite period is treated as a performance condition. The guidance will be effective during our fiscal year ending March 31, 2017. We are currently evaluating the impact of the adoption of this accounting standard update on our

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consolidated financial statements. The standards update may be applied (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In August 2014, the FASB amended accounting guidance pertaining to going concern considerations by company management. The amendments in this update state that in connection with preparing financial statements for each annual and interim reporting period, an entity's management should evaluate whether there are conditions or events that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued, when applicable). The guidance will be effective during our fiscal year ending March 31, 2018. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In February 2015, the FASB issued an accounting standards update, which amended accounting guidance on consolidation. The amendments affect reporting entities that are required to evaluate whether they should consolidate certain legal entities. All legal entities are subject to reevaluation under the revised consolidation model. The update will be effective during our fiscal year ending March 31, 2017. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In April 2015, the FASB issued new guidance related to the customer’s accounting for fees paid in a cloud computing arrangement, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2015. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In July 2015, the FASB issued an accounting standards update that requires an entity to measure inventory balances at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In September 2015, the FASB issued new guidance with respect to Business Combinations. The new guidance requires the acquirer in a Business Combination to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The new guidance is effective for public entities for which fiscal years begin after December 15, 2016, and interim periods within the fiscal years beginning after December 31, 2017. The accounting standard must be applied prospectively to adjustments to provisional amounts that occur after the effective date, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

3. DISCONTINUED OPERATIONS

During the fiscal year ended March 31, 2014, we made the strategic decision to discontinue and exit our software business and therefore executed a plan of sale for Hollywood Software, Inc. d/b/a Cinedigm Software (“Software”), our direct, wholly owned subsidiary, in order to focus on physical and digital distribution of entertainment content and servicing our existing digital cinema business. Furthermore, we believed that Software, which was previously included in our Services segment, no longer complemented our businesses. On September 23, 2014, we completed the sale of Software to a third party and recognized a $3.0 million loss on the sale of the business for the three and six months ended September 30, 2014. As a result, Software has been reclassified as discontinued operations for the three and six months ended September 30, 2014.

Details of income from discontinued operations are as follows:

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(In thousands)	For the Three Months Ended September 30, 2014			For the Six Months Ended September 30, 2014
Revenues	$	919		$	1,968
Costs and Expenses:
Direct operating	151			326
Selling, general and administrative	561			1,093
Research and development	5			14
Total operating expenses	717			1,433
Income from operations	202			535
Other expense, net	(8		)	(93		)
Income before provision for income taxes	194			442
Provision for income taxes	99			—
Income from discontinued operations, net of taxes	$	293		$	442

4. OTHER INTERESTS

Investment in CDF2 Holdings

We indirectly own 100% of the common equity of CDF2 Holdings, LLC ("CDF2 Holdings"), which was created for the purpose of capitalizing on the conversion of the exhibition industry from film to digital technology. CDF2 Holdings assists its customers in procuring the equipment necessary to convert their Systems to digital technology by providing financing, equipment, installation and related ongoing services.

CDF2 Holdings is a Variable Interest Entity (“VIE”), as defined in Accounting Standards Codification Topic 810 ("ASC 810"), “Consolidation." ASC 810 requires the consolidation of VIEs by an entity that has a controlling financial interest in the VIE which entity is thereby defined as the primary beneficiary of the VIE. To be a primary beneficiary, an entity must have the power to direct the activities of a VIE that most significantly impact the VIE's economic performance, among other factors. Although we indirectly, wholly own CDF2 Holdings, we, a third party that also has a variable interest in CDF2 Holdings, and an independent third party manager must mutually approve all business activities and transactions that significantly impact CDF2 Holdings' economic performance. We have therefore assessed our variable interests in CDF2 Holdings and determined that we are not the primary beneficiary of CDF2 Holdings. As a result, CDF2 Holdings' financial position and results of operations are not consolidated in our financial position and results of operations. In completing our assessment, we identified the activities that we consider most significant to the economic performance of CDF2 Holdings and determined that we do not have the power to direct those activities, and therefore we account for our investment in CDF2 Holdings under the equity method of accounting.

As of September 30, 2015 and March 31, 2015, our maximum exposure to loss, as it relates to the non-consolidated CDF2 Holdings entity, represents accounts receivable for service fees under a master service agreement with CDF2 Holdings. Such accounts receivable were $0.4 million and $ $0.3 million as of September 30, 2015 and March 31, 2015, which are included in accounts receivable, net on the accompanying Condensed Consolidated Balance Sheets.

During each of the three months and six months ended September 30, 2015 and 2014, we received $0.3 million and $0.6 million, respectively, in aggregate revenues through digital cinema servicing fees from CDF2 Holdings, which are included in our revenues on the accompanying Condensed Consolidated Statements of Operations.

Total Stockholder's Deficit of CDF2 Holdings at September 30, 2015 and March 31, 2015 was $9.7 million and $6.7 million, respectively. We have no obligation to fund the operating loss or the stockholder's deficit beyond our initial investment of $2.0 million and, accordingly, our in investment in CDF2 Holdings as of September 30, 2015 and March 31, 2015 is carried at $0.

Noncontrolling Interest in CONtv

In June 2014, we and Wizard World, Inc. formed CON TV, LLC (“CONtv”) to fund, design, create, launch, and operate a worldwide digital network that creates original content, and sells and distributes on-demand digital content via the Internet and other consumer digital distribution platforms, such as gaming consoles, set-top boxes, handsets, and tablets.

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We have determined that we have a controlling financial interest in CONtv. As a result, and in accordance with ASC 810, we have consolidated the financial position and results of operations of CONtv as of and for the six months ended September 30, 2015.

During the six months ended September 30, 2015, we made total contributions of $0.6 million in CONtv. Wizard World Inc.'s share of stockholders' deficit in CONtv is reflected as noncontrolling interest in our Condensed Consolidated Balance Sheets and was $0.8 million and $0.2 million as of September 30, 2015 and March 31, 2015, respectively. The noncontrolling interest's share of net loss was $1.2 million for the six months ended September 30, 2015.

5. NOTES PAYABLE

Notes payable consisted of the following:

	September 30, 2015					March 31, 2015
(In thousands)	Current Portion		Long Term Portion			Current Portion		Long Term Portion
2013 Term Loans, net of debt discount	$	22,976	$	23,471		$	25,125	$	36,418
Prospect Loan	—		67,204			—		67,967
KBC Facilities	7,646		15,541			7,649		19,361
P2 Vendor Note	141		356			125		393
P2 Exhibitor Notes	77		147			74		186
Total non-recourse notes payable	30,840		106,719			32,973		124,325
Less: Unamortized debt issuance costs	—		(5,164		)	—		(5,938		)
Total non-recourse notes payable, net of unamortized debt issuance costs	$	30,840	$	101,555		$	32,973	$	118,387
5.5% Convertible Notes Due 2035	$	—	$	64,000		$	—	$	—
Cinedigm Term Loans	—		—			—		17,965
Cinedigm Revolving Loans	—		15,127			24,294		—
2013 Notes	—		3,932			—		3,785
Total recourse notes payable	—		83,059			24,294		21,750
Less: Unamortized debt issuance costs	—		(3,392		)	—		(750		)
Total recourse notes payable, net of unamortized debt issuance costs	$	—	$	79,667		$	24,294	$	21,000
Total notes payable, net of unamortized debt issuance costs	$	30,840	$	181,222		$	57,267	$	139,387

Non-recourse debt is generally defined as debt whereby the lenders’ sole recourse with respect to defaults, is limited to the value of the asset, which is collateral for the debt. Certain of our subsidiaries are liable with respect to, and their assets serve as collateral for, certain indebtedness for which our assets and the assets of our other subsidiaries that are not parties to the transaction are generally not liable. We have referred to this indebtedness as "non-recourse debt" because the recourse of the lenders is limited to the assets of specific subsidiaries. Such indebtedness includes the Prospect Loan, the KBC Facilities, the 2013 Term Loans, the P2 Vendor Note and the P2 Exhibitor Note.

2013 Term Loans

In February 2013, CDF I, our wholly owned subsidiary, entered into an amended and restated credit agreement (the “2013 Credit Agreement”) with Société Générale and other lenders. Under the terms of the 2013 Credit Agreement, CDF I may borrow an aggregate principal amount of $130.0 million, $5.0 million of which was allowed to be assigned to an affiliate of CDF I.

Under the 2013 Credit Agreement, each of the 2013 Term loans bear interest, at the option of CDF I, based on a base rate (generally, the bank prime rate) or the one-month LIBOR rate set at a minimum of 1.00%, plus a margin of 1.75% (in the case of base rate loans) or 2.75% (in the case of LIBOR rate loans). The 2013 Term Loans mature and must be paid in full by February 28, 2018. In addition, CDF I may prepay the 2013 Term Loans, in whole or in part, subject to paying certain breakage costs, if applicable. The one-month LIBOR rate at September 30, 2015 was 0.19%.

The 2013 Credit Agreement also requires each of CDF I’s existing and future direct and indirect domestic subsidiaries (the "Guarantors") to guarantee the obligations under the 2013 Credit Agreement with a first priority perfected security interest in all

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of the collective assets of CDF I and the Guarantors, including real estate owned or leased, and all capital stock or other equity interests in C/AIX, our wholly owned subsidiary and the direct holder of CDF I’s equity. The 2013 Credit Agreement contains customary representations, warranties, affirmative covenants, negative covenants and events of default.

Collections of CDF I accounts receivable are deposited into accounts designated to pay certain operating expenses, principal, interest, fees, costs and expenses relating to the 2013 Credit Agreement. Amounts designated for these purposes totaled $3.8 million and $3.9 million as of September 30, 2015 and March 31, 2015, respectively, and are included in cash and cash equivalents on our Condensed Consolidated Balance Sheets. We also maintain a debt service fund under the 2013 Credit Agreement for future principal and interest payments. As of September 30, 2015 and March 31, 2015, the debt service fund had a balance of $5.8 million, which is classified as restricted cash on our Condensed Consolidated Balance Sheets.

The balance of the 2013 Term Loans, net of the original issue discount, was as follows:

(In thousands)	September 30, 2015			March 31, 2015
2013 Term Loans, at issuance, net	$	125,087		$	125,087
Payments to date	(78,476		)	(63,348		)
Discount on 2013 Term Loans	(164		)	(196		)
2013 Term Loans, net	46,447			61,543
Less current portion	(22,976		)	(25,125		)
Total long term portion	$	23,471		$	36,418

Prospect Loan

In February 2013, our DC Holdings, AccessDM and Phase 2 DC subsidiaries entered into a term loan agreement (the “Prospect Loan”) with Prospect Capital Corporation (“Prospect”), pursuant to which DC Holdings borrowed $70.0 million. The Prospect Loan bears interest at LIBOR plus 9.0% (with a 2.0% LIBOR floor), which is payable in cash, and at an additional 2.50% to be accrued as an increase to the aggregate principal amount of the Prospect Loan until the 2013 Credit Agreement is paid off, at which time all accrued interest will be payable in cash.

Collections of DC Holdings accounts receivable are deposited into accounts designated to pay certain operating expenses, principal, interest, fees, costs and expenses relating to the Prospect Loan. On a quarterly basis, if funds remain after the payment of all such amounts, they are applied to prepay the Prospect Loan. Amounts designated for these purposes, included in cash and cash equivalents on the Condensed Consolidated Balance Sheets, totaled $1.9 million and $6.5 million as of September 30, 2015 and March 31, 2015, respectively. We also maintain a debt service fund under the Prospect Loan for future principal and interest payments. As of September 30, 2015 and March 31, 2015, the debt service fund had a balance of $1.0 million, which is classified as restricted cash on our Condensed Consolidated Balance Sheets.

The Prospect Loan matures on March 31, 2021 and may be accelerated upon a change in control (as defined in the agreement) or other events of default as set forth therein and would be subject to mandatory acceleration upon insolvency of DC Holdings. We are permitted to pay the full outstanding balance of the Prospect Loan at any time after the second anniversary of the initial borrowing, subject to the following prepayment penalties:

• 5.0% of the principal amount prepaid between the second and third anniversaries of issuance;

• 4.0% of the principal amount prepaid between the third and fourth anniversaries of issuance;

• 3.0% of the principal amount prepaid between the fourth and fifth anniversaries of issuance;

• 2.0% of the principal amount prepaid between the fifth and sixth anniversary of issuance;

• 1.0% of the principal amount prepaid between the sixth and seventh anniversaries of issuance; and

• No penalty if the balance of the Prospect Loan, including accrued interest, is prepaid thereafter.

The Prospect Loan is primarily secured by a first priority pledge of the stock of CDF2 Holdings, our wholly owned unconsolidated subsidiary, the stock of AccessDM, which is owned by DC Holdings, and the stock of our Phase 2 DC subsidiary. The Prospect Loan is also guaranteed by our AccessDM and Phase 2 DC subsidiaries. We provide limited financial support to the Prospect Loan not to exceed $1.5 million per year in the event financial performance does not meet certain defined benchmarks.

The Prospect Loan contains customary representations, warranties, affirmative covenants, negative covenants and events of default. The following table summarizes the activity related to the Prospect Loan:

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(In thousands)	September 30, 2015			March 31, 2015
Prospect Loan, at issuance	$	70,000		$	70,000
PIK Interest	4,495			3,640
Payments to date	(7,291		)	(5,673		)
Prospect Loan, net	67,204			67,967
Less current portion	—			—
Total long term portion	$	67,204		$	67,967

KBC Facilities

In December 2008 we began entering into multiple credit facilities to fund the purchase of Systems to be installed in movie theatres as part of our Phase II Deployment. There were no borrowings under the KBC Facilities during the six months ended September 30, 2015. The following table presents a summary of the KBC Facilities (dollar amounts in thousands):

						Outstanding Principal Balance
Facility1	Credit Facility		Interest Rate2		Maturity Date	September 30, 2015	March 31, 2015
1	22,336		3.75	%	September 2018	8,776	10,371
2	13,312		3.75	%	March 2018	5,705	6,656
3	11,425		3.75	%	March 2019	5,712	6,528
4	6,450		3.75	%	September 2018	2,994	3,455
	$	53,523				23,187	27,010

^1.  For each facility, principal is to be repaid in twenty-eight quarterly installments.

^2.  Each of the facilities bears interest at the three-month LIBOR rate, which was 0.33% at September 30, 2015, plus the interest rate noted above.

5.5% Convertible Notes Due April 2035

On April 29, 2015, we issued $64.0 million aggregate principal amount of unsecured senior convertible notes payable (the "Convertible Notes") that bear interest at a rate of 5.5% per year, payable semiannually. The Convertible Notes will mature on April 15, 2035, unless repurchased earlier, redeemed or converted and will be convertible at the option of the holders at any time until the close of business on the business day immediately preceding the maturity date. Upon conversion, we will deliver to holders in respect of each $1,000 principal amount of Convertible Notes being converted a number of shares of our Class A common stock equal to the conversion rate, together with a cash payment in lieu of delivering any fractional share of Class A common stock. The conversion rate applicable to the Convertible Notes on the offering date was 824.5723 shares of Class A common stock per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $1.21 per share of Class A common stock), which is subject to adjustment if certain events occur. Holders of the Convertible Notes may require us to repurchase all or a portion of the Convertible Notes on April 20, 2020, April 20, 2025 and April 20, 2030 and upon the occurrence of certain fundamental changes at a repurchase price in cash equal to 100% of the principal amount of the Convertible Notes to be repurchased plus accrued and unpaid interest, if any. The Convertible Notes will be redeemable by us at our option on or after April 20, 2018 upon the satisfaction of a sale price condition with respect to our Class A common stock and on or after April 20, 2020 without regard to the sale price condition, in each case, at a redemption price in cash equal to 100% of the principal amount of the notes to be repurchased plus accrued and unpaid interest, if any.

The net proceeds from the Convertible Note offering was $60.9 million, after deducting offering expenses. We used $18.6 million of the net proceeds from the offering to repay borrowings under and terminate one of our term loans under our 2013 Credit Agreement, of which $18.2 million was used to pay the remaining principal balance. Concurrently with the closing of the Convertible Notes transaction, we repurchased 2.7 million shares of our Class A common stock from certain purchasers of Convertible Notes in privately negotiated transactions for $2.7 million. In addition, $11.4 million of the net proceeds was used to fund the cost of repurchasing 11.8 million shares of our Class A common stock pursuant to the forward stock purchase agreement described in Note 6 - Stockholders' Deficit. We recorded interest expense of $0.9 million and $1.5 million during the three months and six months ended September 30, 2015, respectively, related to the Convertible Notes.

We recorded debt issuance costs of $3.6 million related to the issuance of the Convertible Notes during the six months ended September 30, 2015.

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Cinedigm Credit Agreement

On October 17, 2013, we entered into a credit agreement (the “Cinedigm Credit Agreement”) with Société Générale. Under the Cinedigm Credit Agreement, as amended in February 2015 and April 2015, we were permitted to borrow an aggregate principal amount of up to $55.0 million, including term loans of $25.0 million (the “Cinedigm Term Loans”) and revolving loans of up to $30.0 million (the “Cinedigm Revolving Loans”). Interest under the Cinedigm Term Loans was charged at a base rate plus 5.0%, or the Eurodollar rate plus 6.0% until the Cinedigm Term Loan was repaid on April 29, 2015 in connection with the Convertible Notes offering. The Cinedigm Revolving Loans bear interest at the base rate plus 4.0% or the Eurodollar rate plus 5.0%. The Base rate, per annum, is equal to the highest of (a) the rate quoted by the Wall Street Journal as the “base rate on corporate loans by at least 75% of the nation’s largest banks,” (b) 0.50% plus the federal funds rate, and (c) the Eurodollar rate plus 1.0%.

We repaid the entire outstanding balance of the Cinedigm Term Loans and amended the terms of the Cinedigm Revolving Loans in connection with our issuance of the Convertible Notes. In connection with the repayment of the Cinedigm Term Loans, we wrote-off certain unamortized debt issuance costs and the discount that remained on the balance of the note payable. As a result, we recorded $0.9 million as a loss on extinguishment of debt for the six months ended September 30, 2015.

The April 2015 amendment to the Cinedigm Revolving Loans extended the term of the agreement to March 31, 2018, provided for the release of the equity interests in the subsidiaries that we had previously pledged as collateral, changed the interest rate and replaced all financial covenants with a single debt service coverage ratio test commencing at June 30, 2016 and a $5.0 million minimum liquidity covenant. The Cinedigm Revolving Loans, as amended, bear interest at Base Rate (as defined in the amendment) plus 3% or LIBOR plus 4%, at our election, but in no event may the elected Base Rate or LIBOR rate be less than 1%. Availability under the Cinedigm Revolving Loans was $17.5 million, of which we borrowed $15.1 million as of September 30, 2015. We are permitted to repay the Cinedigm Revolving Loans, at our option, in whole or in part.

In accordance with the April 2015 amendment to the Cinedigm Revolving Loans, we maintain a debt service reserve account for the aggregate amount of scheduled interest and principal payments due on the Cinedigm Revolving Loans and Convertible notes over the next six months. As of September 30, 2015, we recorded restricted cash of $2.2 million related to the debt service reserve account. No such debt service account was maintained as of March 31, 2015.

2013 Notes

In October 2013, we entered into securities purchase agreements with certain investors, pursuant to which we sold notes in the aggregate principal amount of $5.0 million (the “2013 Notes”) and warrants to purchase an aggregate of 1,500,000 shares of Class A Common Stock (the “2013 Warrants”) to such investors. The proceeds of the sales of the 2013 Notes and 2013 Warrants were primarily used for working capital and general corporate purposes, including financing an acquisition. We allocated a proportional value of $1.6 million to the 2013 Warrants using a Black-Scholes option valuation model with the following assumptions:

Risk free interest rate	1.38	%
Dividend yield	—
Expected life (years)	5
Expected volatility	76.25	%

We have treated the implied fair value of the 2013 Warrants as a discount to the debt that was issued. The debt discount associated with the 2013 Notes is being amortized as interest expense, using the effective interest method, through the maturity of the 2013 Notes.

The principal amount outstanding under the 2013 Notes is due on October 21, 2018. The 2013 Notes bear interest at 9.0% per annum, payable in quarterly installments over the term of the 2013 Notes. The 2013 Notes may be redeemed at any time on or after October 21, 2015, subject to certain premiums.

At September 30, 2015, we were in compliance with all of our debt covenants.

19

6. STOCKHOLDERS’ DEFICIT

COMMON STOCK

During the six months ended September 30, 2015, we issued 679,379 shares of Class A common stock as payment for services rendered by our Board of Directors and certain other third-party advisory services, payment of preferred stock dividends and the exercise of employee stock options.

PREFERRED STOCK

Cumulative dividends in arrears on preferred stock at September 30, 2015 and March 31, 2015 were $0.1 million. In October 2015, we paid preferred stock dividends accrued at September 30, 2015 in the form of 114,644 shares of Class A Common Stock.

TREASURY STOCK

In connection with the offering of Convertible Notes, on April 29, 2015, we repurchased 2,721,000 shares of our Class A common stock from certain purchasers of Convertible Notes in privately negotiated transactions for $2.7 million, which is reflected as treasury stock in our Condensed Consolidated Balance Sheet as of September 30, 2015. In addition, we entered into a privately negotiated forward stock purchase transaction with a financial institution, which is one of the lenders under our credit agreement (the "Forward Counterparty"), pursuant to which we paid $11.4 million to purchase 11,791,384 shares of our Class A common stock for settlement that may be settled at any time prior to the fifth year anniversary of the issuance date of the notes. The payment for the forward contract has been reflected as a reduction of Additional Paid-in Capital on our Condensed Consolidated Balance Sheet until such time that the forward contract is settled and the shares are legally delivered to and owned by us. Upon settlement of the forward contract and delivery of the stock, we will reclassify such amount to treasury stock.

CINEDIGM’S EQUITY INCENTIVE PLAN

Stock Options

Awards issued under our equity incentive plan (the "Plan") may be in any of the following forms (or a combination thereof) (i) stock option awards; (ii) stock appreciation rights; (iii) stock or restricted stock or restricted stock units; or (iv) performance awards. The Plan provides for the granting of incentive stock options (“ISOs”) with exercise prices not less than the fair market value of our Class A Common Stock on the date of grant. ISOs granted to shareholders having more than 10% of the total combined voting power of the Company must have exercise prices of at least 110% of the fair market value of our Class A Common Stock on the date of grant. ISOs and non-statutory stock options granted under the Plan are subject to vesting provisions, and exercise is subject to the continuous service of the participant. The exercise prices and vesting periods (if any) for non-statutory options are set at the discretion of our compensation committee. Upon a change of control of the Company, all stock options (incentive and non-statutory) that have not previously vested will vest immediately and become fully exercisable. In connection with the grants of stock options under the Plan, we and the participants have executed stock option agreements setting forth the terms of the grants. The Plan provides for the issuance of up to 14,300,000 shares of Class A Common Stock to employees, outside directors and consultants.

The following table summarizes the activity of the Plan related to shares issuable pursuant to outstanding options:

	Shares Under Option		Weighted Average Exercise Price Per Share
Balance at March 31, 2015	5,908,670		$	1.72
Granted	130,000		1.51
Exercised	(25,000	)	0.89
Canceled/forfeited	(364,438	)	1.92
Balance at September 30, 2015	5,649,232		1.69

Stock options granted under the Plan during the six months ended September 30, 2015 vest and become exercisable in 25% increments over four years from their grant dates. The weighted average remaining contractual life for stock options outstanding as of September 30, 2015 was 6.78 years.

20

OPTIONS GRANTED OUTSIDE CINEDIGM’S EQUITY INCENTIVE PLAN

In October 2013, we issued options outside of the Plan to 10 individuals that became employees as a result of a business combination. The employees received options to purchase an aggregate of 620,000 shares of our Class A Common Stock at an exercise price of $1.75 per share. The options vest and become exercisable in 25% increments over four years from their grant dates and expire 10 years from the date of grant, if unexercised. As of September 30, 2015, there were 348,750 unvested options outstanding.

In December 2010, we issued options to purchase 4,500,000 shares of Class A Common Stock outside of the Plan as part of our Chief Executive Officer's initial employment agreement with the Company. Such options have exercise prices per share between $1.50 and $5.00, all of which were vested as of December 2013 and will expire in December 2020. As of September 30, 2015, all such options remained outstanding.

WARRANTS

The following table presents information about outstanding warrants to purchase shares of our Class A common stock as of September 30, 2015. All of the outstanding warrants are fully vested and exercisable.

Recipient	Amount outstanding	Expiration	Exercise price per share
Sageview Capital, L.P	16,732,824	August 2016	$1.31
Strategic management service provider	525,000	July 2021	$1.72 - $3.00
Warrants issued to creditors in connection with the 2013 Notes (the "2013 Warrants")	1,250,625	October 2018	$1.85

Outstanding warrants held by Sageview Capital, L.P. ("Sageview") contain customary provisions for cashless exercises and anti-dilution adjustments. In addition, the warrants' expiration date may be extended in limited circumstances.  On April 29, 2015, the number of shares underlying the warrants issued to Sageview and their related exercise price were adjusted from 16,000,000 and $1.37 to 16,732,824 and $1.31, respectively, to give effect to an anti-dilution adjustment that resulted from the issuance of the Convertible Notes.

Outstanding warrants held by the strategic management service provider were issued in connection with a consulting management services agreement ("MSA"). The warrants may be terminated with 90 days' notice in the event of termination of the MSA.

The 2013 Warrants and related 2013 Notes are subject to certain transfer restrictions.

7. COMMITMENTS AND CONTINGENCIES

LEASES

We have capital lease obligations covering a facility and computer equipment. In May 2011, we completed the sale of certain assets and liabilities of the Pavilion Theatre and ceased to operate it at that time. We have remained the primary obligor on the Pavilion capital lease and therefore, the capital lease obligation and the related assets under the capital lease continue to be reflected on our Consolidated Balance Sheets as of September 30, 2015 and March 31, 2015. We have entered into a sub-lease agreement with an unrelated third party purchaser who makes all payments related to the lease and therefore, we have no continuing involvement in the operation of the Pavilion Theatre.

We also operate from leased properties under non-cancelable operating lease agreements, certain of which contain escalating lease clauses.

LITIGATION

Gaiam Dispute

On September 30, 2015, we entered into a Confidential Settlement Agreement and Release (the “Settlement”) with Gaiam, Inc. and Gaiam Americas, Inc. (together, “Gaiam”) relating to disputes arising from our October 2013 acquisition of a division of Gaiam that maintained exclusive distribution rights agreements with large independent studios/content providers, and distributed entertainment content through home video, digital and television distribution channels (the “GVE Acquisition”).

As previously disclosed, we initiated mediation with Gaiam in August 2014 with respect to certain claims resulting from the GVE Acquisition in accordance with the requirements of the Membership Interest Purchase Agreement (the “MIPA”). In January 2015, we participated in a two-day mediation with Gaiam to determine whether the parties’ disputes could be resolved informally without arbitration. The mediation was not successful, and, therefore, the parties pursued their claims and counterclaims against each other through arbitration. After certain procedural disputes, the parties proceeded with two arbitrations, one before a nationally recognized accounting firm to determine the value of the working capital in accordance with the relevant procedures set forth in the MIPA and the other before the American Arbitration Association to resolve the parties’ non-working capital disputes.

The Settlement resolved the claims and counterclaims in both arbitrations and Gaiam agreed to an initial Settlement payment of $2.3 million and a subsequent Settlement payment in an amount to be determined in arbitration.  The Settlement sets a schedule for the arbitration that contemplates its conclusion within approximately 90 days, subject to either party’s right to file a petition to vacate and/or modify the final award determined by the arbitrator. As a result, for the three months and six months ended September 30, 2015, we have recorded the initial Settlement payment as litigation recovery, net of expenses in the Condensed Consolidated Statement of Operations. The initial settlement payment was received in October 2015.

We are subject to certain legal proceedings in the ordinary course of business. We do not expect any such items to have a significant impact on our financial position and results of operations and liquidity.

8. SUPPLEMENTAL CASH FLOW INFORMATION

	For the Six Months Ended September 30,
(in thousands)	2015		2014
Cash interest paid	$	6,571	$	8,474
Accrued dividends on preferred stock	$	89	$	178
Issuance of common stock for payment of preferred stock dividends	$	178	$	178
Deferred consideration recorded in connection with sale of business	$	—	$	1,050

9. SEGMENT INFORMATION

We operate in four reportable segments: Phase I Deployment, Phase II Deployment, Services and Content & Entertainment or CEG. Our segments were determined based on the economic characteristics of our products and services, our internal organizational structure, the manner in which our operations are managed and the criteria used by our Chief Operating Decision Maker to evaluate performance, which is generally the segment’s income (loss) from continuing operations before interest, taxes, depreciation and amortization. Certain Corporate assets, liabilities and operating expenses are not allocated to our reportable segments.

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Operations of:	Products and services provided:
Phase I Deployment	Financing vehicles and administrators for our 3,724 Systems installed nationwide, for which we retain ownership of the Systems and the residual cash flows related to the Systems after the repayment of all non-recourse debt at the expiration of exhibitor master license agreements.
Phase II Deployment	Financing vehicles and administrators for our 8,904 Systems installed domestically and internationally, for which we retain no ownership of the residual cash flows and digital cinema equipment after the completion of cost recoupment and at the expiration of the exhibitor master license agreements.
Services	Provides monitoring, collection, verification and other management services to our Phase I Deployment, Phase II Deployment, CDF2 Holdings, as well as to exhibitors who purchase their own equipment. Services also collects and disburses VPFs from motion picture studios, distributors and ACFs from alternative content providers, movie exhibitors and theatrical exhibitors.
Content & Entertainment	Leading distributor of independent content, and collaborates with producers and other content owners to market, source, curate and distribute independent content to targeted and profitable audiences in theatres and homes, and via mobile and emerging platforms.

The following tables present certain financial information related to our reportable segments and Corporate:

	As of September 30, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	233	$	—	$	60,682	$	108,979	$	—	$	—
Phase II Deployment	—		—		58,483		23,416		—		—
Services	—		—		1,597		—		—		—
Content & Entertainment	28,620		8,701		99,916		—		—		86
Corporate	12		—		18,228		—		79,667		5,107
Total	$	28,865	$	8,701	$	238,906	$	132,395	$	79,667	$	5,193

	As of March 31, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	252	$	—	$	74,595	$	123,722	$	—	$	—
Phase II Deployment	—		—		61,350		27,638		—		—
Services	—		—		1,084		—		—		—
Content & Entertainment	31,520		26,701		122,610		—		—		84
Corporate	12		—		13,378		—		45,294		5,411
Total	$	31,784	$	26,701	$	273,017	$	151,360	$	45,294	$	5,495

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	Statements of Operations
	For the Three Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	9,721	$	3,173	$	3,109	$	11,701		$	—		$	27,704
Direct operating (exclusive of depreciation and amortization shown below)	333		109		3		7,943			—			8,388
Selling, general and administrative	85		23		225		5,768			3,408			9,509
Allocation of Corporate overhead	—		—		405		1,354			(1,759		)	—
Provision for doubtful accounts	—		—		—		—			—			—
Restructuring, transition and acquisition expenses, net	—		—		—		—			63			63
Goodwill impairment	—		—		—		18,000			—			18,000
Litigation settlement recovery, net of expenses	—		—		—		(1,208		)	—			(1,208		)
Depreciation and amortization of property and equipment	7,151		1,881		—		111			284			9,427
Amortization of intangible assets	11		—		—		1,449			3			1,463
Total operating expenses	7,580		2,013		633		33,417			1,999			45,642
Income (loss) from operations	$	2,141	$	1,160	$	2,476	$	(21,716	)	$	(1,999	)	$	(17,938	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	3	$	1	$	—	$	4
Selling, general and administrative	—		—		1		68		328		397
Total stock-based compensation	$	—	$	—	$	4	$	69	$	328	$	401

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	Statements of Operations
	For the Three Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	8,812	$	3,038	$	2,863	$	9,008		$	—		$	23,721
Direct operating (exclusive of depreciation and amortization shown below)	221		137		1		2,952			—			3,311
Selling, general and administrative	183		34		212		4,717			3,067			8,213
Allocation of Corporate overhead	—		—		459		1,336			(1,795		)	—
Provision for doubtful accounts	36		34		8		—			—			78
Restructuring, transition and acquisition expenses, net	—		—		—		576			241			817
Litigation and related expenses	—		—		—		91			—			91
Depreciation and amortization of property and equipment	7,138		1,881		53		51			268			9,391
Amortization of intangible assets	12		—		—		1,451			1			1,464
Total operating expenses	7,590		2,086		733		11,174			1,782			23,365
Income (loss) from operations	$	1,222	$	952	$	2,130	$	(2,166	)	$	(1,782	)	$	356

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	—	$	3	$	—	$	3
Selling, general and administrative	—		—		6		65		333		404
Total stock-based compensation	$	—	$	—	$	6	$	68	$	333	$	407

24

	Statements of Operations
	For the Six Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	17,863		6,068		5,802		20,799			—			50,532
Direct operating (exclusive of depreciation and amortization shown below)	558		200		7		14,915			—			15,680
Selling, general and administrative	338		64		435		10,996			6,494			18,327
Allocation of Corporate overhead	—		—		807		2,701			(3,508		)	—
Provision for doubtful accounts	241		98		—		—			—			339
Restructuring, transition and acquisition expenses, net	—		—		—		—			196			196
Litigation settlement recovery, net of expenses	—		—		—		(410		)	—			(410		)
Goodwill impairment	—		—		—		18,000			—			18,000
Depreciation and amortization of property and equipment	14,304		3,762		—		151			567			18,784
Amortization of intangible assets	19		—		—		2,899			4			2,922
Total operating expenses	15,460		4,124		1,249		49,252			3,753			73,838
Income (loss) from operations	$	2,403	$	1,944	$	4,553	$	(28,453	)	$	(3,753	)	$	(23,306	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I	Phase II	Services	Content & Entertainment	Corporate	Consolidated
Direct operating	—	—	7	3	—	10
Selling, general and administrative	—	—	1	136	926	1,063
Total stock-based compensation	—	—	8	139	926	1,073

25

	Statements of Operations
	For the Six Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I	Phase II	Services	Content & Entertainment		Corporate		Consolidated
Revenues	18,296	6,209	5,923	16,150		—		46,578
Direct operating (exclusive of depreciation and amortization shown below)	465	274	52	11,024		—		11,815
Selling, general and administrative	278	73	412	9,100		5,948		15,811
Allocation of Corporate overhead	—	—	925	2,689		(3,614	)	—
Provision for doubtful accounts	96	55	21	—		—		172
Restructuring, transition and acquisition expenses, net	—	—	—	1,418		345		1,763
Litigation and related expenses	—	—	—	202		—		202
Depreciation and amortization of property and equipment	14,275	3,762	106	92		532		18,767
Amortization of intangible assets	23	—	—	3,324		2		3,349
Total operating expenses	15,137	4,164	1,516	27,849		3,213		51,879
Income (loss) from operations	3,159	2,045	4,407	(11,699	)	(3,213	)	(5,301	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I	Phase II	Services	Content & Entertainment	Corporate	Consolidated
Direct operating	—	—	—	6	—	6
Selling, general and administrative	—	—	10	129	880	1,019
Total stock-based compensation	—	—	10	135	880	1,025

ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in conjunction with our historical consolidated financial statements and the related notes included elsewhere in this document.

This report contains forward-looking statements within the meaning of the federal securities laws. These include statements about our expectations, beliefs, intentions or strategies for the future, which are indicated by words or phrases such as “believes,” “anticipates,” “expects,” “intends,” “plans,” “will,” “estimates,“ and similar words. Forward-looking statements represent, as of the date of this report, our judgment relating to, among other things, future results of operations, growth plans, sales, capital requirements and general industry and business conditions applicable to us.  These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties, assumptions and other factors, some of which are beyond the Company’s control that could cause actual results to differ materially from those expressed or implied by such forward-looking statements.  

OVERVIEW

Since our inception, we have played a significant role in the digital distribution revolution that continues to transform the media landscape. In addition to our pioneering role in transitioning over 12,000 movie screens from traditional analog film prints to digital distribution, we have become a leading distributor of independent content, both through organic growth and acquisitions. We distribute products for major brands such as the Discovery Networks, National Geographic and Scholastic, as well as leading international and domestic content creators, movie producers, television producers and other short form digital content producers. We collaborate with producers, major brands and other content owners to market, source, curate and distribute quality content to targeted audiences through (i) existing and emerging digital home entertainment platforms, including but not limited to, iTunes, Amazon Prime, Netflix, Hulu, Xbox, PlayStation, and cable video-on-demand ("VOD"), and (ii) physical goods, including DVD and Blu-ray Discs.

We report our financial results in four primary segments as follows: (1) the first digital cinema deployment (“Phase I Deployment”), (2) the second digital cinema deployment (“Phase II Deployment”), (3) digital cinema services (“Services”) and (4) media content and entertainment group (“Content & Entertainment” or "CEG"). The Phase I Deployment and Phase II Deployment segments are the non-recourse, financing vehicles and administrators for our digital cinema equipment (the “Systems”) installed in movie theatres throughout the United States and in Australia and New Zealand. Our Services segment provides fee based support to over 12,000 movie screens in our Phase I Deployment, Phase II Deployment segments as well as directly to exhibitors and other third party customers in the form of monitoring, billing, collection and verification services. Our Content & Entertainment segment is focused on: (1) ancillary market aggregation and distribution of entertainment content and; (2) branded and curated over-the-top ("OTT") digital network business providing entertainment channels and applications.

We are structured so that our digital cinema business (collectively, the Phase I Deployment, Phase II Deployment and Services segments) operates independently from our Content & Entertainment segment. As of September 30, 2015, we had approximately $137.7 million of scheduled principal payments outstanding on non-recourse debt, which exclude debt discounts and unamortized debt issuance costs, that are serviced by our digital cinema business. We also had approximately $84.1 million of scheduled outstanding principal payments on recourse debt that are not attributable to a particular reportable segment and are therefore reported as part of our Corporate operations.

We reported consolidated net losses from continuing operations of $23.1 million during the three months ended September 30, 2015 and we have an accumulated deficit of $333.7 million as of September 30, 2015. We also have significant contractual obligations related to our non-recourse and recourse debt. We may continue generating consolidated net losses for the foreseeable future. We believe the combination of: (i) our cash and restricted cash balances at September 30, 2015, (ii) the remaining availability under our revolving line of credit, (iii) planned cost reduction initiatives, and (iv) expected cash flows from operations will be sufficient to satisfy our liquidity and capital requirements for the next twelve months. Our capital requirements will depend on many factors, and we may need to use available capital resources and raise additional capital. As a result of our ongoing process of exploring and evaluating potential significant strategic and capital raising opportunities with the help of our financial advisor, we are in discussions with a potential investor to help meet our ongoing capital raising requirements. There can be no assurance that the transaction under discussion will be consummated. Failure to generate additional revenues, raise additional capital or manage discretionary spending could have an adverse effect on our financial position, results of operations and liquidity.

26

Results of Continuing Operations for the Three Months Ended September 30, 2015 and 2014

Revenues

	For the Three Months Ended September 30,
($ in thousands)	2015		2014		$ Change		% Change
Phase I Deployment	$	9,721	$	8,812	$	909	10	%
Phase II Deployment	3,173		3,038		135		4	%
Services	3,109		2,863		246		9	%
Content & Entertainment	11,701		9,008		2,693		30	%
	$	27,704	$	23,721	$	3,983	17	%

Revenues in our Phase I and Phase II Deployment businesses reflect the wide release of 33 titles in both three month periods ended September 30, 2015 and September 30, 2014. Two blockbuster titles released in the three months ended September 30, 2015, accounted for the increase over the prior period. No blockbuster films were released on our deployed systems in the three months ended September 30, 2014.

Revenue generated by our Services segment increased as a result of the higher VPFs earned by our Phase I and II deployment businesses. Our Services segment earns commissions on VPF revenue generated by the Phase I and Phase II deployment segments.

Revenues at our Content & Entertainment segment increased, due to significantly fewer product returns compared to the same period in the prior year. We continue to shift our strategy toward developing a portfolio of narrowcast OTT channels. At the end of fiscal year 2015, we launched CONtv in cooperation with Wizard World, Inc., and in the second quarter of fiscal year 2016 we launched the Dove Channel, which targets families and kids seeking high quality and family friendly content approved by the Dove Foundation.

Direct Operating Expenses

	For the Three Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	333	$	221	$	112		51	%
Phase II Deployment	109		137		(28		)	(20	)%
Services	3		1		2			200	%
Content & Entertainment	7,943		2,952		4,991			169	%
	$	8,388	$	3,311	$	5,077		153	%

Direct operating expenses increased in the three months ended September 30, 2015, mainly driven by increased revenue in our CEG business, higher third party distribution costs and higher OTT platform and content distribution costs compared to the period ended September 30, 2014. In addition, the quarter ended September 30, 2014 reflects delays in the timing and realization of certain supply chain expenses, which were later recognized in the third and fourth fiscal year ended March 31, 2015. The increase was slightly offset by reduced costs related to theatrical releasing, marketing and content acquisitions costs as we made the strategic decision to focus significantly less on theatrical film releases and more on OTT channel entertainment in the 2015 fiscal year.

Selling, General and Administrative Expenses

	For the Three Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	85	$	183	$	(98	)	(54	)%
Phase II Deployment	23		34		(11		)	(32	)%
Services	225		212		13			6	%
Content & Entertainment	5,768		4,717		1,051			22	%
Corporate	3,408		3,067		341			11	%
	$	9,509	$	8,213	$	1,296		16	%

Selling, general and administrative expenses increased in our Content & Entertainment segment compared to the prior period, primarily reflecting increased operating expenses related to our OTT business, which we launched in the fourth quarter of the

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fiscal ended March 31, 2015, partially offset by lower salaries and related expenses in our traditional content business. Selling general and administrative expenses increased at Corporate primarily as a result of $0.5 million of legal and professional fees recorded in connection with activist shareholder proposals.

Restructuring, Transition and Acquisitions Expenses

Restructuring, transition and acquisitions expense, net were $0.1 million for the three months ended September 30, 2015, which reflects the final stages of our integration of the GVE Acquisition. In the three months ended September 30, 2014, we recorded restructuring, transition and acquisitions expenses, net of $0.8 million, primarily related to professional fees, workforce reduction and integration related to the GVE Acquisition.

Goodwill Impairment

In the three months ended September 30, 2015, we recorded a goodwill impairment charge of $18.0 million. We reassessed the fair value of our CEG reporting unit in the second fiscal quarter of 2015 because the reporting unit was expected to perform below the fiscal year 2016 forecast that we had established during our annual testing of goodwill at March 31, 2015. We faced challenges in the first half of fiscal 2016 that significantly impacted our ability to establish the new contracts, customer relationships and OTT channels that we had originally anticipated and shifted a portion of management's focus away from business operations. As a result, our fiscal 2016 projections for revenue and adjusted EBITDA are expected to fall materially below our original estimates, particularly those for the second half of the fiscal year. No goodwill impairment was recorded in the three months ended September 30, 2014.

Litigation settlement recovery, net of expenses

In the three months ended September 30, 2015 we recorded income of $1.2 million, net of related expenses, in connection with a legal settlement arising from disputes related to our October 2013 GVE Acquisition. The settlement agreement was entered into on September 30, 2015 and resolved the claims and counterclaims from all preceding arbitrations and the counterparty agreed to an initial settlement payment of $2.3 million and a subsequent settlement payment which is to be determined in arbitration. The settlement set a schedule for arbitration to be completed within approximately 90 days of September 30, 2015.

Depreciation and Amortization Expense on Property and Equipment

	For the Three Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	7,151	$	7,138	$	13		—	%
Phase II Deployment	1,881		1,881		—			—	%
Services	—		53		(53		)	(100	)%
Content & Entertainment	111		51		60			118	%
Corporate	284		268		16			6	%
	$	9,427	$	9,391	$	36		—	%

Depreciation and amortization expense was consistent with the prior period, as we have not had significant additions to our property and equipment balances.

Interest expense, net

	For the Three Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	3,111	$	3,451	$	(340	)	(10	)%
Phase II Deployment	318		397		(79		)	(20	)%
Corporate	1,763		1,145		618			54	%
	$	5,192	$	4,993	$	199		4	%

Interest expense reported by our Phase I and Phase II Deployment segments decreased primarily as a result of reduced debt balances compared to the prior period and the payoff of one of our KBC facilities. In addition, we paid a lower interest rate on the Phase I

28

2013 Term Loans compared to the prior year. We expect interest expense related to the KBC Facilities to continue to decrease due to the pay-down of such balances.

Interest expense at Corporate increased during the three months ended September 30, 2015, primarily as a result of the issuance of the Convertible Notes in April 2015. In the three months ended September 30, 2015, we recorded interest expense of $0.9 million related to the Convertible Notes. We used a portion of the proceeds from the Convertible Notes to pay off the $18.2 million Term Loan associated with the Cinedigm Credit Agreement. As a result, incremental interest expense recorded in connection with the Convertible Notes was slightly offset by the reduced amount of interest expense in connection with the extinguished Term Loans under the Cinedigm Credit Agreement. Although borrowings under our revolving line of credit decreased from the same period in the prior year, borrowings in the six months ended September 30, 2015 were outstanding for a longer period of time and therefore resulted in an increase to interest expense compared to the prior period.

The change in fair value of the interest rate derivatives was a loss of approximately $0.1 million for the three months ended September 30, 2015, compared to income of $0.1 million for the same period in the prior year.  

Adjusted EBITDA

We define Adjusted EBITDA to be earnings before interest, taxes, depreciation and amortization, other income, net, stock-based compensation and expenses, merger and acquisition costs, restructuring, transition and acquisitions expense, net, goodwill impairment and certain other items.

Adjusted EBITDA (including the results of Phase 1 and Phase II Deployments segments) decreased 9% compared to the three months ended September 30, 2014. Adjusted EBITDA from our non-deployment businesses was a loss of $0.9 million during the three months ended September 30, 2015, compared to income of $1.4 million for the three months ended September 30, 2014. The reconciliation of Adjusted EBITDA for three months ended September 30, 2015, also takes into consideration $0.5 million of legal and other professional fees, primarily related to activist shareholder proposals, and a recovery related to a the settlement of the GVE litigation of $1.2 million, net of related expenses recorded in the period. The decrease in adjusted EBITDA compared to the prior period primarily reflects higher operating expenses in our Content & Entertainment business and Corporate, particularly advertising, marketing and consulting expenses.

Adjusted EBITDA is not a measurement of financial performance under GAAP and may not be comparable to other similarly titled measures of other companies. We use Adjusted EBITDA as a financial metric to measure the financial performance of the business because management believes it provides additional information with respect to the performance of its fundamental business activities. For this reason, we believe Adjusted EBITDA will also be useful to others, including its stockholders, as a valuable financial metric.

We present Adjusted EBITDA because we believe that Adjusted EBITDA is a useful supplement to net loss from continuing operations as an indicator of operating performance. We also believe that Adjusted EBITDA is a financial measure that is useful both to management and investors when evaluating our performance and comparing our performance with that of our competitors. We also use Adjusted EBITDA for planning purposes and to evaluate our financial performance because Adjusted EBITDA excludes certain incremental expenses or non-cash items, such as stock-based compensation charges, that we believe are not indicative of our ongoing operating performance.

We believe that Adjusted EBITDA is a performance measure and not a liquidity measure, and therefore a reconciliation between net loss from continuing operations and Adjusted EBITDA has been provided in the financial results. Adjusted EBITDA should not be considered as an alternative to income from operations or net loss from continuing operations as an indicator of performance or as an alternative to cash flows from operating activities as an indicator of cash flows, in each case as determined in accordance with GAAP, or as a measure of liquidity. In addition, Adjusted EBITDA does not take into account changes in certain assets and liabilities as well as interest and income taxes that can affect cash flows. We do not intend the presentation of these non-GAAP measures to be considered in isolation or as a substitute for results prepared in accordance with GAAP. These non-GAAP measures should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP.

Following is the reconciliation of our consolidated Adjusted EBITDA to consolidated GAAP loss from continuing operations:

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	For the Three Months Ended September 30,
($ in thousands)	2015			2014
Loss from continuing operations	$	(23,074	)	$	(4,592	)
Add Back:
Depreciation and amortization of property and equipment	9,427			9,391
Amortization of intangible assets	1,463			1,464
Interest expense, net	5,192			4,993
Other income, net	(124		)	39
Change in fair value of interest rate derivatives	68			(84		)
Stock-based compensation and expenses	401			407
Goodwill impairment	18,000			—
Restructuring, transition and acquisition expenses, net	63			817
Professional fees pertaining to activist shareholder proposals and compliance	500			39
Litigation and related expenses	942			91
Litigation settlement recovery	(2,150		)	—
Net loss attributable to noncontrolling interest	741			—
Adjusted EBITDA	$	11,449		$	12,565
Adjustments related to the Phase I and Phase II Deployments:
Depreciation and amortization of property and equipment	$	(9,032	)	$	(9,019	)
Amortization of intangible assets	(11		)	(12		)
Income from operations	(3,301		)	(2,174		)
Adjusted EBITDA from non-deployment businesses	$	(895	)	$	1,360

Results of Continuing Operations for the Six Months Ended September 30, 2015 and 2014

Revenues

	For the Six Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	17,863	$	18,296	$	(433	)	(2	)%
Phase II Deployment	6,068		6,209		(141		)	(2	)%
Services	5,802		5,923		(121		)	(2	)%
Content & Entertainment	20,799		16,150		4,649			29	%
	$	50,532	$	46,578	$	3,954		8	%

Revenues in our Phase I and Phase II Deployment businesses decreased compared to the prior period, primarily because there were fewer wide titles released in the six months ended September 30, 2015 than in the same period of the prior year. Systems deployed and screen utilization rates were consistent with the prior period.

Revenue generated by our Services segment decreased as a result of the reduced VPFs earned by our Phase I and II deployment businesses. Our Services segment earns commissions on VPF revenue generated by the Phase I and Phase II deployment segments.

Revenues at our Content & Entertainment segment increased, reflecting increased revenues related to digitally distributed content, significantly fewer product returns compared to the September 30, 2014 period. The increase was partially offset by the continued decline in sales and shelf space allotted to packaged goods for our traditional DVD and Blu-ray business, which has been negatively impacted by changes in technology and consumer behavior. To offset this secular trend, we continue to shift our strategy toward developing a portfolio of narrowcast OTT channels. Our first channel, Docurama, was launched in May 2014 and leverages our existing content library. In March 2015, we launched CONtv in cooperation with Wizard World, Inc., leveraging their large fan

30

base and national convention presence, and in September 2015, we launched the Dove Channel, targeting families and kids seeking high quality and family friendly content approved by the Dove Foundation.

Direct Operating Expenses

	For the Six Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	558	$	465	$	93		20	%
Phase II Deployment	200		274		(74		)	(27	)%
Services	7		52		(45		)	(87	)%
Content & Entertainment	14,915		11,024		3,891			35	%
	$	15,680	$	11,815	$	3,865		33	%

Direct operating expenses increased in the six months ended September 30, 2015, mainly driven by increased revenue in our CEG business, higher third party distribution costs, and OTT platform and content distribution costs compared to the period ended September 30, 2014. The increase was slightly offset by reduced costs related to theatrical releasing, marketing and content acquisitions costs as we made the strategic decision to focus significantly less on theatrical film releases and more on OTT channel entertainment in the 2015 fiscal year.

Selling, General and Administrative Expenses

	For the Six Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	338	$	278	$	60		22	%
Phase II Deployment	64		73		(9		)	(12	)%
Services	435		412		23			6	%
Content & Entertainment	10,996		9,100		1,896			21	%
Corporate	6,494		5,948		546			9	%
	$	18,327	$	15,811	$	2,516		16	%

Selling, general and administrative expenses increased compared to the prior period, primarily reflecting a $1.6 million increase in advertising and marketing expenses in our Content & Entertainment business related to our CONtv OTT channel, which launched in the fourth quarter of the prior fiscal year, and professional fees at Corporate. For the six months ended September 30, 2015 we recorded $0.8 million of incremental legal and other professional fees related to certain activist shareholder proposals.

In the six months ended September 30, 2015, we also recorded a provision for doubtful accounts related to a customer that filed for Chapter 11 bankruptcy relief.

Restructuring, Transition and Acquisitions Expenses

Restructuring, transition and acquisitions expenses, net were $0.2 million for the six months ended September 30, 2015, which reflects the final stages of our integration of the GVE Acquisition. In the six months ended September 30, 2014, we recorded $1.8 million of restructuring, transition and acquisitions expenses, primarily related to professional fees, workforce reduction and integration related to the GVE Acquisition.

Goodwill Impairment

In the six months ended September 30, 2015, we recorded a goodwill impairment charge of $18.0 million. We reassessed the fair value of our CEG reporting unit in the second fiscal quarter of 2015 because the reporting unit was expected to perform below the fiscal year 2016 forecast that we had established during our annual testing of goodwill at March 31, 2015. We faced challenges in the first half of fiscal 2016 that significantly impacted our ability to establish the new contracts, customer relationships and OTT channels that we had originally anticipated and shifted a portion of management's focus away from business operations. As a result, our fiscal 2016 projections for revenue and adjusted EBITDA are expected to fall materially below our original estimates, particularly those for the second half of the fiscal year. No goodwill impairment was recorded in the three and six months ended September 30, 2014.

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Litigation recovery, net of expenses

In the six months ended September 30, 2015 we recorded a recovery of $0.4 million, net of related expenses, in connection with a legal settlement arising from disputes related to our October 2013 GVE Acquisition. The settlement agreement was entered into on September 30, 2015 and resolved the claims and counterclaims from all preceding arbitrations and the counterparty agreed to an initial settlement payment of $2.3 million and a subsequent settlement payment which is to be determined in arbitration. The settlement set a schedule for arbitration to be completed within approximately 90 days of September 30, 2015.

Depreciation and Amortization Expense on Property and Equipment

	For the Six Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	14,304	$	14,275	$	29		—	%
Phase II Deployment	3,762		3,762		—			—	%
Services	—		106		(106		)	(100	)%
Content & Entertainment	151		92		59			64	%
Corporate	567		532		35			7	%
	$	18,784	$	18,767	$	17		—	%

Depreciation and amortization expense was consistent with the comparable quarter in the prior fiscal year, as we have not added substantially to our property and equipment balances.

Amortization of intangible assets

Amortization of intangible assets decreased to $2.9 million for the fiscal quarter ended September 30, 2015from $3.3 million as certain intangible assets became fully amortized in the prior fiscal year.

Interest expense, net

	For the Six Months Ended September 30,
($ in thousands)	2015		2014		$ Change			% Change
Phase I Deployment	$	6,256	$	6,979	$	(723	)	(10	)%
Phase II Deployment	654		809		(155		)	(19	)%
Corporate	3,412		2,240		1,172			52	%
	$	10,322	$	10,028	$	294		3	%

We made principal payments of $38.8 million on our long-term debt arrangements and made payments (net of borrowings) under our revolving credit facility of $9.2 million in the six months ended September 30, 2015. On April 29, 2015 we issued $64.0 million aggregate principal amount of unsecured senior convertible notes payable (the "Convertible Notes") that bear interest at a rate of 5.5% per year, payable semiannually.

Interest expense reported by our Phase I and Phase II Deployment segments decreased primarily as a result of reduced debt balances compared to the prior period and the payoff of a KBC facility. In addition, we paid a lower interest rate on the Phase I 2013 Term Loans compared to the prior year. We expect interest expense related to the KBC Facilities to continue to decrease due to the pay-down of such balances.

Interest expense at Corporate increased during the six months ended September 30, 2015, primarily as a result of the issuance of the Convertible Notes. In the six months ended September 30, 2015, we recorded interest expense of $1.5 million related to the Convertible Notes. In April 2015, we used a portion of the proceeds from the Convertible Notes to pay off the $18.2 million Term Loan associated with the Cinedigm Credit Agreement. As a result, incremental interest expense recorded in connection with the Convertible Notes and increased borrowings under the revolving credit facility was slightly offset by reduced interest expense in connection with the Term Loans under the Cinedigm Credit Agreement. Although borrowings under our revolving credit facility increased from the same period in the prior year, such borrowings were not outstanding for the entire period during the six months ended September 30, 2015 and therefore did not add materially to the change from the prior period.

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In connection with the repayment of the Term Loans under the Cinedigm Credit Agreement, we wrote-off certain debt issuance costs and the discount that remained on the balance of the Term Loans. As a result, we recorded $0.9 million as a loss on the extinguishment of debt in the six months ended September 30, 2015.

The change in fair value of the interest rate derivatives was a loss of approximately $0.1 million and a loss of 0.2 million for the six months ended September 30, 2015 and 2014, respectively.  

Adjusted EBITDA

We define Adjusted EBITDA to be earnings before interest, taxes, depreciation and amortization, other income, net, stock-based compensation and expenses, merger and acquisition costs, restructuring, transition and acquisitions expense, net, goodwill impairment and certain other items.

Adjusted EBITDA (including the results of Phase 1 and Phase II Deployments segments) for the six months ended September 30, 2015 decreased 3% compared to same period in the prior fiscal year. Adjusted EBITDA from our non-deployment businesses also decreased compared to the six months ended September 30, 2014. The reconciliation of Adjusted EBITDA for six months ended September 30, 2015, also takes into consideration incremental legal and other professional fees of $0.8 million, primarily related to activist shareholder proposals and a recovery related to a the settlement of the GVE litigation of $0.4 million, net of related expenses recorded in the period. The decrease in adjusted EBITDA compared to the prior period primarily reflects higher selling, general and administrative expenses at Corporate, a higher provision for doubtful accounts and lower revenues in our deployment businesses compared to the same period in the prior fiscal year.

Adjusted EBITDA is not a measurement of financial performance under GAAP and may not be comparable to other similarly titled measures of other companies. We use Adjusted EBITDA as a financial metric to measure the financial performance of the business because management believes it provides additional information with respect to the performance of its fundamental business activities. For this reason, we believe Adjusted EBITDA will also be useful to others, including its stockholders, as a valuable financial metric.

We present Adjusted EBITDA because we believe that Adjusted EBITDA is a useful supplement to net loss from continuing operations as an indicator of operating performance. We also believe that Adjusted EBITDA is a financial measure that is useful both to management and investors when evaluating our performance and comparing our performance with that of our competitors. We also use Adjusted EBITDA for planning purposes and to evaluate our financial performance because Adjusted EBITDA excludes certain incremental expenses or non-cash items, such as stock-based compensation charges, that we believe are not indicative of our ongoing operating performance.

We believe that Adjusted EBITDA is a performance measure and not a liquidity measure, and therefore a reconciliation between net loss from continuing operations and Adjusted EBITDA has been provided in the financial results. Adjusted EBITDA should not be considered as an alternative to income from operations or net loss from continuing operations as an indicator of performance or as an alternative to cash flows from operating activities as an indicator of cash flows, in each case as determined in accordance with GAAP, or as a measure of liquidity. In addition, Adjusted EBITDA does not take into account changes in certain assets and liabilities as well as interest and income taxes that can affect cash flows. We do not intend the presentation of these non-GAAP measures to be considered in isolation or as a substitute for results prepared in accordance with GAAP. These non-GAAP measures should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP.

Following is the reconciliation of our consolidated Adjusted EBITDA to consolidated GAAP loss from continuing operations:

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	For the Six Months Ended September 30,
($ in thousands)	2015			2014
Loss from continuing operations	$	(34,393	)	$	(15,404	)
Add Back:
Depreciation and amortization of property and equipment	18,784			18,767
Amortization of intangible assets	2,922			3,349
Interest expense, net	10,322			10,028
Loss on extinguishment of debt	931			—
Other income, net	(232		)	(100		)
Change in fair value of interest rate derivatives	66			175
Stock-based compensation and expenses	1,073			1,025
Goodwill impairment	18,000			—
Restructuring, transition and acquisition expenses, net	196			1,763
Professional fees pertaining to activist shareholder proposals and compliance	800			39
Litigation and related expenses	1,740			202
Litigation settlement recovery	(2,150		)	—
Net loss attributable to noncontrolling interest	1,175			—
Adjusted EBITDA	$	19,234		$	19,844
Adjustments related to the Phase I and Phase II Deployments:
Depreciation and amortization of property and equipment	$	(18,066	)	$	(18,037	)
Amortization of intangible assets	(19		)	(23		)
Income from operations	(4,347		)	(5,204		)
Adjusted EBITDA from non-deployment businesses	$	(3,198	)	$	(3,420	)

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP"). In connection with the preparation of our financial statements, we are required to make assumptions and estimates about future events, and apply judgments that affect the reported amounts of assets, liabilities, revenue, expenses and the related disclosures. We base our assumptions, estimates and judgments on historical experience, current trends and other factors that management believes to be relevant at the time our consolidated financial statements are prepared. On a regular basis, management reviews the accounting policies, assumptions, estimates and judgments to ensure that our financial statements are presented fairly and in accordance with GAAP. However, because future events and their effects cannot be determined with certainty, actual results could differ from our assumptions and estimates, and such differences could be material.

Our significant accounting policies are discussed in Note 2 - Summary of Significant Accounting Policies, of the Notes to Condensed Consolidated Financial Statements, included in Item 1, Financial Statements of this Quarterly Report on Form 10-Q. Management believes that the following accounting policies are the most critical to aid in fully understanding and evaluating our reported financial results, and they require management's most difficult, subjective or complex judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain. Management has reviewed these critical accounting estimates and related disclosures with the Audit Committee of our board of directors.

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation expense is recorded using the straight-line method over the estimated useful lives of the respective assets as follows:

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Computer equipment and software	3-5 years
Digital cinema projection systems	10 years
Machinery and equipment	3-10 years
Furniture and fixtures	3-6 years

Leasehold improvements are being amortized over the shorter of the lease term or the estimated useful life of the improvement. Maintenance and repair costs are charged to expense as incurred. Major renewals, improvements and additions are capitalized.

Useful lives are determined based on an estimate of either physical or economic obsolescence, or both. During the fiscal years ended March 31, 2015 and 2014, we have neither made any revisions to estimated useful lives, nor recorded any impairment charges from continuing operations on our property and equipment.

FAIR VALUE ESTIMATES

Goodwill and Intangible and Long-Lived Assets

We must estimate the fair value of assets acquired and liabilities assumed in a business combination. Our assessment of the estimated fair value of each of these can have a material effect on our reported results as intangible assets are amortized over various lives. Furthermore, a change in the estimated fair value of an asset or liability often has a direct influence on the amount to recognize as goodwill, which is an asset that is not amortized. Often determining the fair value of these assets and liabilities assumed requires an assessment of expected use of the assets and the expected costs to extinguish the liabilities. Such estimates are inherently difficult and subjective and can have a material influence on our consolidated financial statements.

We use either the income, cost or market approach to aid in our conclusions of such fair values and asset lives. The income approach presumes that the value of an asset can be estimated by the net economic benefit to be received over the life of the asset, discounted to present value. The cost approach presumes that an investor would pay no more for an asset than its replacement or reproduction cost. The market approach estimates value based on what other participants in the market have paid for reasonably similar assets. Although each valuation approach is considered in valuing the assets acquired, the approach ultimately selected is based on the characteristics of the asset and the availability of information.

We evaluate our goodwill for impairment in the fourth quarter of each fiscal year (as of March 31), or whenever events or changes in circumstances indicate the fair value of a reporting unit is below its carrying amount. The determination of whether or not goodwill has become impaired involves a significant level of judgment in the assumptions underlying the approach used to determine the value of our reporting units. Inherent in the fair value determination for each reporting unit are certain judgments and estimates relating to future cash flows, including management’s interpretation of current economic indicators and market conditions, and assumptions about our strategic plans with regard to our operations. To the extent additional information arises, market conditions change or our strategies change, it is possible that the conclusion regarding whether goodwill is impaired could change and result in future goodwill impairment charges that could have a material effect on our consolidated financial position or results of operations.

When testing goodwill for impairment we are permitted to make a qualitative assessment of whether goodwill is impaired, or choose to bypass the qualitative assessment, and proceed directly to performing the first step of the two-step impairment test. If we perform a qualitative assessment and conclude it is more likely than not that the fair value of a reporting unit exceeds its carrying value, goodwill is not considered impaired and the two-step impairment test is unnecessary. However, if we conclude otherwise, we are then required to perform the first step of the two-step impairment test.

We review the recoverability of our long-lived assets and finite-lived intangible assets, when events or conditions occur that indicate a possible impairment exists. Determining whether impairment has occurred typically requires various estimates and assumptions, including determining which cash flows are directly related to the potentially impaired asset, the useful life over which cash flows will occur, their amount and the asset's residual value, if any. The assessment for recoverability is based primarily on our ability to recover the carrying value of its long-lived and finite-lived assets from expected future undiscounted net cash flows. If the total of expected future undiscounted net cash flows is less than the total carrying value of the assets the asset is deemed not to be recoverable and possibly impaired. We then estimate the fair value of the asset to determine whether an impairment loss should be recognized. An impairment loss will be recognized if the asset's fair value is determined to be less than its carrying value. Fair value is determined by computing the expected future discounted cash flows.

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Stock-based Compensation

Stock-based compensation expense is measured at the grant date based on the fair value of the award and is recognized as expense over the vesting period. Determining the fair value of stock-based awards at the grant date requires judgment in estimating expected stock volatility and the amount of stock-based awards that are expected to be forfeited. If actual results differ significantly from these estimates, stock-based compensation expense and our results of operations could be materially affected.

REVENUE RECOGNITION

Phase I Deployment and Phase II Deployment

VPFs are earned, net of administrative fees, pursuant to contracts with movie studios and distributors, whereby amounts are payable by a studio to Phase 1 DC, CDF I and to Phase 2 DC when movies distributed by the studio are displayed on screens utilizing our Systems installed in movie theatres. VPFs are earned and payable to Phase 1 DC and CDF I based on a defined fee schedule with a reduced VPF rate year over year until the sixth year (calendar 2011) at which point the VPF rate remains unchanged through the tenth year, at which point the VPFs phase out. One VPF is payable for every digital title displayed per System. The amount of VPF revenue is dependent on the number of movie titles released and displayed using the Systems in any given accounting period. VPF revenue is recognized in the period in which the digital title first plays on a System for general audience viewing in a digitally equipped movie theatre, as Phase 1 DC’s, CDF I’s and Phase 2 DC’s performance obligations have been substantially met at that time. Beginning in December 2015, certain Phase 1 DC Systems will have reached the conclusion of their deployment payment period. In accordance with existing agreements with distributors, a substantial portion of VPF revenues will cease to be recognized on such Systems. Because the Phase I deployment installation period ended in November 2007, a majority of the VPF revenue associated with the Phase I systems will end by November 2017. While the absence of such revenue is not expected to be material to the Condensed Consolidated Statements of Operations during the fiscal year ending March 31, 2016, it is expected to have a material cumulative impact in subsequent periods.

Phase 2 DC’s agreements with distributors require the payment of VPFs, according to a defined fee schedule, for ten years from the date each system is installed; however, Phase 2 DC may no longer collect VPFs once “cost recoupment,” as defined in the contracts with movie studios and distributors, is achieved. Cost recoupment will occur once the cumulative VPFs and other cash receipts collected by Phase 2 DC have equaled the total of all cash outflows, including the purchase price of all Systems, all financing costs, all “overhead and ongoing costs”, as defined, and including service fees, subject to maximum agreed upon amounts during the three-year rollout period and thereafter. Further, if cost recoupment occurs before the end of the eighth contract year, the studios will pay us a one-time “cost recoupment bonus.”  Any other cash flows, net of expenses, received by Phase 2 DC following the achievement of cost recoupment are required to be returned to the distributors on a pro-rata basis. At this time, we cannot estimate the timing or probability of the achievement of cost recoupment. Beginning in December 2018, certain Phase 2 DC Systems will have reached the conclusion of their deployment payment period, subject to earlier achievement of cost recoupment. In accordance with existing agreements with distributors, VPF revenues will cease to be recognized on such Systems. Because the Phase II deployment installation period ended in December 2012, a majority of the VPF revenue associated with the Phase I systems will end by December 2022 or earlier if cost recoupment is achieved.

Alternative content fees (“ACFs”) are earned pursuant to contracts with movie exhibitors, whereby amounts are payable to Phase 1 DC, CDF I and to Phase 2 DC, generally either a fixed amount or as a percentage of the applicable box office revenue derived from the exhibitor’s showing of content other than feature movies, such as concerts and sporting events (typically referred to as “alternative content”). ACF revenue is recognized in the period in which the alternative content first opens for audience viewing.

Revenues earned in connection with up front exhibitor contributions are deferred and recognized over the expected cost recoupment period.

Services

Exhibitors who purchased and own Systems using their own financing in the Phase II Deployment paid us an upfront activation fee of approximately $2.0 thousand per screen (the “Exhibitor-Buyer Structure”). Upfront activation fees were recognized in the period in which these Systems were delivered and ready for content, as we had no further obligations to the customer after that time and collection was reasonably assured. In addition, we recognize activation fee revenue of between $1.0 thousand and $2.0 thousand on Phase 2 DC Systems and for Systems installed by CDF2 Holdings upon installation and such fees are generally collected upfront upon installation. Our Services segment manages and collects VPFs on behalf of exhibitors, for which it earns an administrative fee equal to 10% of the VPFs collected.

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Our Services segment earns an administrative fee of approximately 5% of Phase I Deployment VPFs collected and earns an incentive service fee equal to 2.5% of the VPFs earned by Phase 1 DC. This administrative fee is recognized in the period in which the billing of VPFs occurs, as performance obligations have been substantially met at that time.

Content & Entertainment

CEG earns fees for the distribution of content in the home entertainment markets via several distribution channels, including digital, video-on-demand, and physical goods (e.g., DVD and Blu-ray Discs). Fees earned are typically based on the gross amounts billed to our customers less the amounts owed to the media studios or content producers under distribution agreements, and gross media sales of owned or licensed content. Depending upon the nature of the agreements with the platform and content providers, the fee rate that we earn varies. Generally, revenues are recognized when content is available for subscription on the digital platform, at the time of shipment for physical goods, or point-of-sale for transactional and video-on-demand services. Reserves for sales returns and other allowances are provided based upon past experience. If actual future returns and allowances differ from past experience, adjustments to our allowances may be required. Sales returns and allowances are reported net in accounts receivable and as a reduction of revenues.

CEG also has contracts for the theatrical distribution of third party feature movies and alternative content. CEG’s distribution fee revenue and CEG's participation in box office receipts is recognized at the time a feature movie and alternative content are viewed. CEG has the right to receive or bill a portion of the theatrical distribution fee in advance of the exhibition date, and therefore such amount is recorded as a receivable at the time of execution, and all related distribution revenue is deferred until the third party feature movies’ or alternative content’s theatrical release date.

Revenue is deferred in cases where a portion or the entire contract amount cannot be recognized as revenue due to non-delivery of services. Such amounts are classified as deferred revenue and are recognized as earned revenue in accordance with our revenue recognition policies described above.

PARTICIPATIONS AND ROYALTIES PAYABLE

We record liabilities within accounts payable and accrued expenses on the Condensed Consolidated Balance Sheet, that represent amounts owed to studios or content producers for which we provide content distribution services for royalties owed under licensing arrangements. We identify and record as a reduction to the liability any expenses that are to be reimbursed to us by such studios or content producers.

Recent Accounting Pronouncements

In May 2014, the FASB issued new accounting guidance on revenue recognition. The new standard provides for a single five-step model to be applied to all revenue contracts with customers as well as requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. Companies have an option to use either a retrospective approach or cumulative effect adjustment approach to implement the standard. The guidance will be effective during our fiscal year ending March 31, 2019 with early adoption permitted. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In June 2014, the FASB issued an accounting standards update, which provides additional guidance on how to account for share-based payments where the terms of an award may provide that the performance target could be achieved after an employee completes the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite period is treated as a performance condition. The guidance will be effective during our fiscal year ending March 31, 2017. We are currently evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements. The standards update may be applied (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In August 2014, the FASB amended accounting guidance pertaining to going concern considerations by company management. The amendments in this update state that in connection with preparing financial statements for each annual and interim reporting period, an entity's management should evaluate whether there are conditions or events that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued, when applicable). The guidance will be effective during our fiscal year ending March 31, 2018. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

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In February 2015, the FASB issued an accounting standards update, which amended accounting guidance on consolidation. The amendments affect reporting entities that are required to evaluate whether they should consolidate certain legal entities. All legal entities are subject to reevaluation under the revised consolidation model. The update will be effective during our fiscal year ending March 31, 2017. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In April 2015, the FASB issued new guidance related to the customer’s accounting for fees paid in a cloud computing arrangement, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2015. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In July 2015, the FASB issued an accounting standards update that requires an entity to measure inventory balances at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. The Company is currently evaluating the impact of the new guidance to the consolidated financial statements.

In September 2015, the FASB issued new guidance with respect to Business Combinations. The new guidance requires the acquirer in a Business Combination to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. Prior to the new guidance, acquirers were required to retrospectively adjust the provisional amounts recognized at the acquisition date with a corresponding adjustment to goodwill. This amendment eliminates the requirement to retrospectively account for those adjustments. The new guidance goes into effect for those public entities whose fiscal year begins after December 15, 2016. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

Liquidity and Capital Resources

We have incurred net losses each year since we commenced our operations. Since our inception, we have financed our operations substantially through the private placement of shares of our common and preferred stock, the issuance of promissory notes, our initial public offering and subsequent private and public offerings, notes payable and common stock used to fund various acquisitions.

We may continue to generate net losses for the foreseeable future primarily due to depreciation and amortization, interest on the Convertible Notes, 2013 Term Loans, Prospect Loan and Cinedigm Credit Agreement, marketing and promotional activities and content acquisition and marketing costs. Certain of these costs, including costs of content acquisition, marketing and promotional activities, could be reduced if necessary. The restrictions imposed by the 2013 Term Loans and Prospect Loan may limit our ability to obtain financing, make it more difficult to satisfy our debt obligations or require us to dedicate a substantial portion of our cash flow to payments on our existing debt obligations. The Prospect Loan requires certain screen turn performance from Phase 1 DC and Phase 2 DC. While such restrictions may reduce the availability of our cash flow to fund working capital, capital expenditures and other corporate requirements, we do not have similar restrictions imposed upon our CEG businesses. We may seek to raise additional capital for strategic acquisitions or working capital as necessary. Failure to generate additional revenues, raise additional capital or manage discretionary spending could have an adverse effect on our financial position, results of operations or liquidity.

Our business is primarily driven by the growth in global demand for entertainment content in all forms and, in particular, the shifting consumer demand for content in digital forms within home and mobile devices as well as the maturing digital cinema marketplace. Our primary revenue drivers are expected to be the increasing number of digitally equipped devices/screens and the demand for entertainment content in theatrical, home and mobile ancillary markets. According to the Motion Picture Association of America, during 2014 there were approximately 43,000 domestic (United States and Canada) movie theatre screens and approximately 142,000 screens worldwide, of which approximately 42,000 of the domestic screens were equipped with digital cinema technology, and 12,628 of those screens contained our Systems. Historically, the number of digitally equipped screens in the marketplace has been a significant determinant of our potential revenue. Going forward, the expansion of our content business into ancillary distribution markets and digital distribution of narrowcast OTT content are expected to be the primary driver of our revenues.

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Beginning in December 2008, Phase 2 B/AIX, our indirect wholly owned subsidiary, began entering into credit facilities with KBC to fund the purchase of Systems to be installed in movie theatres as part of our Phase II Deployment. As of September 30, 2015, the outstanding commitments related to the KBC Facilities was $23.2 million.

In February 2013, we entered into a $125.0 million senior non-recourse credit facility led by Société Générale and a $70.0 million non-recourse credit facility provided by Prospect Capital Corporation. These two non-recourse credit facilities are supported by the cash flows of the Phase 1 deployment and our digital cinema servicing business. As of September 30, 2015, the scheduled outstanding principal payments on these non-recourse credit facilities, which exclude the impacts of debt discounts and unamortized debt issuance costs, was $113.8 million.

In October 2013, we entered into the Cinedigm Credit Agreement pursuant to which we borrowed term loans of $25.0 million (which were repaid in April 2015 in connection with the issuance of the Convertible Notes described below) and revolving loans of up to $30.0 million, of which $15.1 million of the revolving loans were drawn upon as of September 30, 2015. The Cinedigm Credit Agreement, which further enhances our working capital needs and ability to further invest in entertainment content, will be supported by the cash flows of our media library. Additionally, in 2013, we entered into a mezzanine financing agreement providing $5.0 million of financing.

In April 2015, we issued $64.0 million aggregate principal amount of 5.5% convertible senior notes (the "Convertible Notes"), due April 15, 2035,unless earlier repurchased, redeemed or converted. The net proceeds from the note offering were approximately $60.9 million, after deducting the initial purchaser's discount and estimated offering expenses payable. In connection with the closing of the offering, we used approximately $18.6 million of the net proceeds to repay and terminate the term loan underthe Cinedigm Credit Agreement. In addition,we used $11.4 million of the net proceeds to enter into a structured forward stock purchase transaction to acquire approximately 11.8 million shares of our Class A common stock for settlement on or about the fifth year anniversary of the issuance date of the Convertible Notes and approximately $2.6 million to repurchase approximately 2.7 million shares of our Class A common stock from certain purchasers of the Convertible Notes in privately negotiated transactions.

As of September 30, 2015, the scheduled outstanding principal payments on our recourse notes payable, which exclude the impact of debt discounts and unamortized debt issuance costs, was $84.1 million.

As of September 30, 2015, we had negative working capital, defined as current assets less current liabilities, of $0.4 million and cash and cash equivalents and restricted cash totaling $27.9 million.

Changes in our cash flows were as follows:

	For the Six Months Ended September 30,
($ in thousands)	2015			2014
Net cash provided by operating activities	$	4,626		$	2,547
Net cash (used in) provided by investing activities	(453		)	1,469
Net cash used in financing activities	(4,209		)	(24,485		)
Net decrease in cash and cash equivalents	$	(36	)	$	(20,469	)

Net cash provided by operating activities is primarily driven by income or loss from operations, excluding non-cash expenses such as depreciation, amortization, bad debt provisions and stock-based compensation, offset by changes in working capital. We expect cash received from VPFs to remain consistent with the current fiscal year and support non-recourse debt pay-down. Changes in accounts receivable from our studio customers and others largely impact cash flows from operating activities and vary based on the seasonality of movie release schedules by the major studios. Operating cash flows from CEG are typically higher during our fiscal third and fourth quarters, resulting from revenues earned during the holiday season, and lower in the following two quarters as we pay royalties on such revenues. In addition, we make advances on theatrical releases and to certain home entertainment distribution clients, for which initial expenditures are generally recovered within six to twelve months. To manage working capital fluctuations, we have a revolving line of credit that allows for borrowings of up to $30.0 million, of which $17.5 million was available for borrowing as of September 30, 2015. Timing and volume of our trade accounts payable can also be a significant factor impacting cash flows from operations. Certain non-cash expense fluctuations, primarily resulting from the change in the fair value of interest rate derivative arrangements, can also impact the timing and amount of cash flows from operations. We expect operating activities to continue to be a positive source of cash.

In the six months ended September 30, 2015, our cash flow from operations was negatively impacted by incremental legal and professional fees associated with the GVE litigation and expenses related to certain activist shareholder proposals.

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Cash flows from investing activities consisted of purchases of property and equipment, offset by capital contributions of $0.6 million from the noncontrolling interest in CONtv.

For the six months ended September 30, 2015, cash flows used in financing activities primarily reflects:

• payments of $38.8 million on our long-term debt arrangements;

• net payments made on our revolving credit facility of $9.2 million;

• a payment of $11.4 million to purchase a forward contract related to our structured stock repurchase program;

• repurchases of common stock of $2.7 million;

• and repayments capital lease obligations; offset by:

• the issuance of $64.0 million aggregate amount of 5.5% Senior Convertible Notes, due April 2035.

We used $18.2 million of the proceeds from the Convertible Notes offering to repay the remaining outstanding principal balance of the term loan under the Cinedigm Credit Agreement.

We have contractual obligations that include long-term debt consisting of notes payable, credit facilities, non-cancelable long-term capital lease obligations for the Pavilion Theatre, capital leases for information technology equipment and other various computer related equipment, non-cancelable operating leases consisting of real estate leases, and minimum guaranteed obligations under theatre advertising agreements with exhibitors for displaying cinema advertising. The capital lease obligation of the Pavilion Theatre is paid by an unrelated third party, although Cinedigm remains the primary lessee and would be obligated to pay if the unrelated third party were to default on its rental payment obligations.

The following table summarizes our significant contractual obligations as of September 30, 2015:

	Payments Due
Contractual Obligations (in thousands)	Total		2016		2017 & 2018		2019 & 2020		Thereafter
Long-term recourse debt	$	84,127	$	15,127	$	—	$	5,000	$	64,000
Long-term non-recourse debt (1)	147,773		30,840		38,820		859		77,254
Capital lease obligations (2)	5,193		676		1,328		1,397		1,792
Debt-related obligations, principal	$	237,093	$	46,643	$	40,148	$	7,256	$	143,046
Interest on recourse debt	$	71,777	$	3,971	$	7,940	$	7,066	$	52,800
Interest on non-recourse debt (1)	47,771		9,753		17,124		16,629		4,265
Interest on capital leases (2)	3,323		767		1,315		907		334
Total interest	$	122,871	$	14,491	$	26,379	$	24,602	$	57,399
Total debt-related obligations	$	359,964	$	61,134	$	66,527	$	31,858	$	200,445
Total non-recourse debt including interest	$	195,544	$	40,593	$	55,944	$	17,488	$	81,519
Operating lease obligations	$	7,674	$	624	$	2,457	$	2,610	$	1,983

(1) Non-recourse debt is generally defined as debt whereby the lenders’ sole recourse, with respect to defaults, is limited to the value of the asset that is collateral for the debt. The 2013 Term Loans are not guaranteed by us or our other subsidiaries, other than Phase 1 DC and CDF I, the Prospect Loan is not guaranteed by us or our other subsidiaries, other than Phase 1 DC and DC Holdings and the KBC Facilities are not guaranteed by us or our other subsidiaries, other than Phase 2 DC.

(2) Represents the capital lease and capital lease interest for the Pavilion Theatre and capital leases on information technology equipment. We have remained the primary obligor on the Pavilion capital lease, and therefore, the capital lease obligation and related assets under the capital lease remain on our consolidated financial statements as of September 30, 2015. However, we have entered into a sub-lease agreement with the unrelated third party purchaser which pays the capital lease and as such, we have no continuing involvement in the operation of the Pavilion Theatre. This capital lease was previously included in discontinued operations.

Seasonality

Revenues from our Phase I Deployment and Phase II Deployment segments derived from the collection of VPFs from motion picture studios are seasonal, coinciding with the timing of releases of movies by the motion picture studios. Generally, motion

40

picture studios release the most marketable movies during the summer and the winter holiday season. The unexpected emergence of a hit movie during other periods can alter the traditional trend. The timing of movie releases can have a significant effect on our results of operations, and the results of one quarter are not necessarily indicative of results for the next quarter or any other quarter. While CEG benefits from the winter holiday season, we believe the seasonality of motion picture exhibition, however, is becoming less pronounced as the motion picture studios are releasing movies somewhat more evenly throughout the year.

Off-balance sheet arrangements

We are not a party to any off-balance sheet arrangements, other than operating leases in the ordinary course of business, which are disclosed above in the table of our significant contractual obligations, and CDF2 Holdings, LLC ("CDF2 Holdings"), our wholly owned unconsolidated subsidiary. As discussed further in Note 4 - Other Interests to the Consolidated Financial Statements included in Item 1 of this Report on Form 10-Q, we hold a 100% equity interest in CDF2 Holdings, which is an unconsolidated variable interest entity (“VIE”), which wholly owns Cinedigm Digital Funding 2, LLC; however, we are not the primary beneficiary of the VIE.

Impact of Inflation

The impact of inflation on our operations has not been significant to date.  However, there can be no assurance that a high rate of inflation in the future would not have an adverse impact on our operating results.

Item 4. CONTROLS AND PROCEDURES

Our management, with the participation of our principal executive officer and principal financial officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report.

Based on such evaluation, our principal executive officer and principal financial officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a timely basis, information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act and are effective in ensuring that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

There have been no changes in the Company’s internal control over financial reporting during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Gaiam Dispute

On September 30, 2015, we entered into a Confidential Settlement Agreement and Release (the “Settlement”) with Gaiam, Inc. and Gaiam Americas, Inc. (together, “Gaiam”) relating to disputes arising from our October 2013 acquisition of a division of Gaiam that maintained exclusive distribution rights agreements with large independent studios/content providers, and distributed entertainment content through home video, digital and television distribution channels (the “GVE Acquisition”).

As previously disclosed, we initiated mediation with Gaiam in August 2014 with respect to certain claims resulting from the GVE Acquisition in accordance with the requirements of the Membership Interest Purchase Agreement (the “MIPA”). In January 2015, we participated in a two-day mediation with Gaiam to determine whether the parties’ disputes could be resolved informally without arbitration. The mediation was not successful, and, therefore, the parties pursued their claims and counterclaims against each other through arbitration. After certain procedural disputes, the parties proceeded with two arbitrations, one before a nationally recognized accounting firm to determine the value of the working capital in accordance with the relevant procedures set forth in the MIPA and the other before the American Arbitration Association to resolve the parties’ non-working capital disputes.

The Settlement resolved the claims and counterclaims in both arbitrations and Gaiam agreed to an initial Settlement payment of $2.3 million and a subsequent Settlement payment in an amount to be determined in arbitration.  The Settlement sets a schedule

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for the arbitration that contemplates its conclusion within approximately 90 days, subject to either party’s right to file a petition to vacate and/or modify the final award determined by the arbitrator.

ITEM 1A. RISK FACTORS

There have been no material changes to the Risk Factors disclosed in Item 1A of our Annual Report on Form 10-K for the fiscal year ended March 31, 2015.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

a) Sales of Unregistered Securities

None.

b) Use of Proceeds from Public Offering of Common Stock 

None.

c) Issuer Purchases of Equity Securities

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not Applicable.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

The exhibits are listed in the Exhibit Index on page 46 herein.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

CINEDIGM CORP.

Date:	November 9, 2015	By:	/s/ Christopher J. McGurk
			Christopher J. McGurk Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)
Date:	November 9, 2015	By:	/s/ Jeffrey S. Edell
			Jeffrey S. Edell Chief Financial Officer (Principal Financial Officer)

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EXHIBIT INDEX

Exhibit Number Description of Document

3.1	‑‑	Amended and Restated Bylaws, as amended.
10.1	‑‑	Confidential Settlement Agreement and Release dated as of September 30, 2015, among Gaiam Inc., Gaiam Americas, Inc., Cinedigm Corp. and Cinedigm Entertainment Holdings, LLC (confidential portions have been omitted and filed separately with the Securities and Exchange Commission).
31.1	‑‑	Officer's Certificate Pursuant to 15 U.S.C. Section 7241, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	‑‑	Officer's Certificate Pursuant to 15 U.S.C. Section 7241, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	‑‑	Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	‑‑	Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS	‑‑	XBRL Instance Document.
101.SCH	‑‑	XBRL Taxonomy Extension Schema.
101.CAL	‑‑	XBRL Taxonomy Extension Calculation.
101.DEF	‑‑	XBRL Taxonomy Extension Definition.
101.LAB	‑‑	XBRL Taxonomy Extension Label.
101.PRE	‑‑	XBRL Taxonomy Extension Presentation.

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EX-3.1

Exhibit 3.1

AMENDED AND RESTATED

BY-LAWS

OF

CINEDIGM CORP.

ADOPTED April 11, 2000

AMENDED AND RESTATED June 30, 2015

BY-LAWS

OF

CINEDIGM CORP.

TABLE OF CONTENTS

	Page
ARTICLE I MEETINGS OF STOCKHOLDERS	1
Section 1.1 Place of Meetings	1
Section 1.2 Annual Meetings	1
Section 1.3 Special Meetings	1
Section 1.4 Notice of Meetings	1
Section 1.5 Record Date for Meeting of Stockholders	1
Section 1.6 Informal Action	1
Section 1.7 Record Date for Informal Action	1
Section 1.8 Action by Stockholders Not Solicited by the Board of Directors	2
Section 1.9 Quorum and Voting	3
Section 1.10 Conduct of Stockholder Meetings	3
Section 1.11 Inspectors of Election	3
ARTICLE II DIRECTORS	4
Section 2.1 Powers of Directors	4
Section 2.2 Number, Election and Term of Office	4
Section 2.3 Vacancies	4
Section 2.4 Meetings of Directors	4
Section 2.5 Informal Action	4
Section 2.6 Telephone Participation in Meetings	4
Section 2.7 Committees of Directors	5
Section 2.8 Removal	5
Section 2.9 Compensation	5
ARTICLE III OFFICERS	5
Section 3.1 Enumeration	5
Section 3.2 President	5
Section 3.3 Vice President	5
Section 3.4 Secretary	5
Section 3.5 Treasurer	6
Section 3.6 Other Officers and Assistant Officers	6
Section 3.7 Term and Compensation	6
ARTICLE IV INDEMNIFICATION	6
Section 4.1 Directors and Officers	6
Section 4.2 Payment of Expenses	6
Section 4.3 Permissive Indemnification and Advancement of Expenses	7
Section 4.4 Determination of Indemnification	7
Section 4.5 Insurance	7
Section 4.6 Powers of the Board	8
Section 4.7 Definition - Corporation	8
Section 4.8 Definition - Authorized Representative	8

ARTICLE V SHARES OF CAPITAL STOCK	8
Section 5.1 Issuance of Stock	8
Section 5.2 Stock Certificates	8
Section 5.3 Transfer of Stock	8
Section 5.4 Lost, Stolen, Destroyed, or Mutilated Certificates	8
Section 5.5 Regulations	8
Section 5.6 Holders of Record	9
Section 5.7 Restriction on Transfer	9
ARTICLE VI GENERAL PROVISIONS	9
Section 6.1 Corporate Seal	9
Section 6.2 Fiscal Year	9
Section 6.3 Authorization	9
Section 6.4 Financial Reports	9
Section 6.5 Effect of By-laws	9
ARTICLE VII AMENDMENTS	9

BY-LAWS

OF

CINEDIGM CORP.

__________________

ARTICLE I

MEETINGS OF STOCKHOLDERS

Section 1.1Place of Meetings. Meetings of the stockholders shall be held at such place within or without the State of Delaware as shall be designated by the Board of Directors or the person or persons calling the meeting.

Section 1.2Annual Meetings. The annual meeting of the stockholders for the election of directors and the transaction of such other business as may properly come before the meeting shall be held after the close of the Corporation’s fiscal year on such date and at such time as shall be designated by the Board of Directors.

Section 1.3Special Meetings. Special meetings may be called at any time by the President or the Board of Directors. Business transacted at each special meeting shall be confined to the purposes stated in the notice of such meeting.

Section 1.4Notice of Meetings. A written notice stating the place, date, and hour of each meeting and, in the case of a special meeting, the purpose or purposes for which the meeting is called shall be given by, or at the direction of, the Secretary or the person or persons authorized to call the meeting to each stockholder of record entitled to vote at such meeting, not less than ten (10) days nor more than sixty (60) days before the date of the meeting, unless a greater period of time is required by law in a particular case.

Section 1.5Record Date for Meeting of Stockholders. In order to determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board of Directors may fix, in advance, a record date, which shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting. If no record date is fixed, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date.

Section 1.6Informal Action. Any action required to be taken at any annual or special meeting of stockholders of the Corporation, or any action which may be taken at any annual or special meeting of the stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing.

Section 1.7Record Date for Informal Action. In order to determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors shall be entitled to fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the board of directors.

Any stockholder of record seeking to have the stockholders authorize or take corporate action by written consent shall, by written notice to the Secretary, request the board of directors to fix a

record date. Such written notice must set forth as to each action that the stockholder proposes to take by consent (a) the text of the proposal (including the text of any resolutions to be adopted by consent), (b) the name and address, as they appear on the Corporation’s books, of such stockholder and the name and address of the beneficial owner, if any, on whose behalf the proposal is made, and (c) the number of shares of each class or series of capital stock of the Corporation that are owned beneficially (and proof of any such beneficial ownership) or of record by such stockholder or such beneficial owner. If the proposed action by consent involves the election of directors, the notice shall set forth all information that is required to be disclosed in solicitations of proxies for election of directors, including information about the stockholder (and, if applicable, the beneficial owner) setting forth the proposal and each nominee whom the stockholder proposes to elect, or is otherwise required, in each case pursuant to Section 14 of the Securities Exchange Act of 1934, as amended (including the nominees’ written consent to being named in the proxy or information statement as a potential director and to serving as a director if elected). During the ten (10) day period following the date of receipt of the notice required under this Section 1.7, the Corporation may require the stockholder and/or beneficial owner requesting a record date for proposed stockholder action by consent to furnish such other information as it may reasonably require to determine the validity of the request for a record date.

The Board of Directors shall be entitled to adopt promptly a resolution fixing the record date; provided that if the Board of Directors determines to so fix a record date it must adopt such resolution within ten (10) days after the date on which the request is received. If no record date has been fixed by the Board of Directors within ten (10) days of the date on which such a request is received, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by applicable law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business or to any officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded, to the attention of the Secretary of the Corporation. Delivery made to the Corporation's registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the board of directors and prior action by the Board of Directors is required by applicable law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the date on which the board of directors adopts the resolution taking such prior action.

Every written consent shall bear the date of signature of each stockholder who signs the consent and no written consent shall be effective to take the corporate action referred to therein unless, within 60 days of the earliest dated written consent delivered in accordance with this Section 1.7, a written consent or consents signed by a sufficient number of stockholders to take such action are delivered to the Corporation in the manner prescribed hereunder.

Section 1.8Action by Stockholders Not Solicited by the Board of Directors. Prior and as a condition to the effectiveness of any action taken pursuant to Section 1.7 of the By-laws by the Board of Directors, which has not been solicited or recommended by the Board of Directors, the Board of Directors shall have ten (10) business days from the receipt of notice of the action taken by the Stockholders, to verify the validity and legality of the action taken by the Stockholders.

Section 1.9Quorum and Voting. The holders of a majority of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings or the stockholders for the transaction of business, except as otherwise expressly provided by statute, by the Certificate of Incorporation or by these By-laws. If, however, such majority shall not be

present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting (except as otherwise provided by statute). At such adjourned meeting at which the requisite amount of voting stock shall be represented any business may be transacted which might have been transacted at the meeting as originally notified. At all meetings of the stockholders each stockholder having the right to vote shall be entitled to vote in person, or by proxy appointed by an instrument in writing subscribed by such stockholder and bearing a date not more than three years prior to said meeting, unless such instrument lawfully provides for a longer period. At each meeting of the stockholders each stockholder shall have one vote for each share of capital stock having voting power, registered in his name on the books of the Corporation at the record date fixed in accordance with these By-laws, or otherwise determined, with respect to such meeting. Except as otherwise expressly provided by statute, by the Certificate of Incorporation or by these By-laws, all matters coming before any meeting of the stockholders shall be decided by the vote of a majority of the number of shares of stock present in person or represented by proxy at such meeting and entitled to vote thereat, a quorum being present.

Section 1.10Conduct of Stockholder Meetings. The Board of Directors shall appoint a chairman of the meeting of stockholders, or if no such chairman is appointed prior to the meeting, the Chairman of the Board shall serve as the chairman of the meeting. The order of business at each meeting of stockholders shall be as determined by the chairman of the meeting. Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chairman of the meeting shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts and things as are necessary or desirable for the proper conduct of the meeting, including, without limitation, the establishment of procedures for the maintenance of order and safety, limitations on the time allotted to presenting proposals or to questions or comments on the affairs of the Corporation, restrictions on entry to such meeting after the time prescribed for the commencement thereof and the opening and closing of the voting polls. The chairman of the meeting, in addition to making any other determinations that may be appropriate to the conduct of the meeting, shall, if the facts warrant, determine and declare to the meeting that a matter or business was not properly brought before the meeting and if the chairman should so determine, shall so declare to the meeting and any such matter or business not properly brought before the meeting shall not be transacted or considered.

Section 1.11Inspectors of Election. The Corporation may, and shall if required by law, in advance of any meeting of stockholders, appoint one or more inspectors of election, who may (unless otherwise required by applicable law) be employees of the Corporation, to act at the meeting or any adjournment thereof and to make a written report thereof. The Corporation may designate one or more persons as alternate inspectors to replace any inspector who fails to act. In the event that no inspector so appointed or designated is able to act at a meeting of stockholders, the chairman of the meeting shall appoint one or more inspectors to act at the meeting. Each inspector, before entering upon the discharge of his or her duties, shall take and sign an oath to execute faithfully the duties of inspector with strict impartiality and according to the best of his or her ability. The inspector or inspectors so appointed or designated shall (i) ascertain the number of shares of capital stock of the Corporation outstanding and the voting power of each such share, (ii) determine the shares of capital stock of the Corporation represented at the meeting and the validity of proxies and ballots, (iii) count all votes and ballots, (iv) determine and retain for a reasonable period a record of the disposition of any challenges made to any determination by the inspectors, and (v) certify their determination of the number of shares of capital stock of the Corporation represented at the meeting and such inspectors’ count of all votes and ballots. Such certification and report shall specify such other information as may be required by law. In determining the validity and counting of proxies and ballots cast at any meeting of stockholders of the Corporation, the inspectors may consider such information as is

permitted by applicable law. No person who is a candidate for an office at an election may serve as an inspector at such election.

ARTICLE II

DIRECTORS

Section 2.1Powers of Directors. The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors, which shall exercise all powers that may be exercised or performed by the Corporation and that are not by statute, the Certificate of Incorporation or these By-laws directed to be exercised or performed by the stockholders.

Section 2.2Number, Election and Term of Office. The Board of Directors shall consist of not less than two (2) nor more than eleven (11) members as fixed from time to time by the Board of Directors. Directors need not be stockholders of the Corporation. The directors shall be elected by the stockholders at the annual meeting or any special meeting called for such purpose. Each director shall hold office until his or her successor shall be duly elected and qualified or until his or her earlier resignation or removal. A director may resign at any time upon written notice to the Corporation.

Section 2.3Vacancies. Vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled by a majority vote of the directors then in office, although less than a quorum, or by a sole remaining director. The occurrence of a vacancy which is not filled by action of the Board of Directors shall constitute a determination by the Board of Directors that the number of directors is reduced so as to eliminate such vacancy, unless the Board of Directors shall specify otherwise. When one or more directors shall resign from the Board, effective at a future date, a majority of the directors then in office, including those who have so resigned, shall have power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations shall become effective.

Section 2.4Meetings of Directors. Regular meetings of the Board of Directors shall be held at such time and place as the Board of Directors shall from time to time by resolution appoint; and no notice shall be required to be given of any such regular meeting. A special meeting of the Board of Directors may be called by the President or any director by giving two (2) days’ notice to each director by letter, telegram, telephone or other oral message. Except as otherwise provided by these By-laws, a majority of the total number of directors shall constitute a quorum for the transaction of business, and the vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board of Directors.

Section 2.5Informal Action. Any action required or permitted to be taken at any meeting of the Board of Directors, or of any committee thereof, may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee.

Section 2.6Telephone Participation in Meetings. Members of the Board of Directors, or any committee designated by the Board, may participate in a meeting of the Board of Directors or such committee by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this Section shall constitute presence in person at such meeting.

Section 2.7Committees of Directors. By resolutions adopted by a majority of the whole Board of Directors, the Board may designate an Executive Committee and one or more other committees, each such committee to consist of one or more directors of the Corporation. The Executive Committee shall

have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Corporation (except as otherwise expressly limited by statute), including the power and authority to declare dividends and to authorize the issuance of stock, and may authorize the seal of the corporation to be affixed to all papers which may require it. Each such committee shall have such of the powers and authority of the Board as may be provided from time to time in resolutions adopted by a majority of the whole Board. The requirements with respect to the manner in which the Executive Committee and each such other committee shall hold meetings and take actions shall be set forth in the resolutions of the Board of Directors designating the Executive Committee or such other committee.

Section 2.8Removal. A director may be removed by a majority vote of the Board for cause, as such term is generally used and defined under Delaware General Corporate Law.

Section 2.9Compensation. The directors shall receive such compensation for their services as may be authorized by resolution of the Board of Directors. Nothing herein contained shall be construed to preclude any director from serving the Corporation in any other capacity and receiving compensation therefor.

ARTICLE III

OFFICERS

Section 3.1Enumeration. The officers of the Corporation shall be elected by the Board of Directors and shall consist of a President, such number of Vice Presidents (if any) as the Board of Directors shall from time to time elect, a Secretary, a Treasurer, and such other officers (if any) as the Board of Directors shall from time to time elect. The Board of Directors may at any time elect one of its members as Chairman of the Board of the Corporation, who shall preside at meetings of the Board of Directors and of the stockholders and shall have such powers and perform such duties as shall from time to time be prescribed by the Board of Directors. Any two or more offices may be held by the same person.

Section 3.2President. The President shall be the chief executive officer of the Corporation, and shall have general and active charge and control over the business and affairs of the Corporation, subject to the Board of Directors. If there shall be no Chairman of the Board, or in his or her absence or inability to act, the President shall preside at meetings of the Board of Directors and of the stockholders.

Section 3.3Vice President. The Vice President or, if there shall be more than one, the Vice Presidents, in the order of their seniority unless otherwise specified by the Board of Directors, shall have all of the powers and perform all of the duties of the President during the absence or inability to act of the President. Each Vice President shall also have such other powers and perform such other duties as shall from time to time be prescribed by the Board of Directors or the President.

Section 3.4Secretary. The Secretary shall record the proceedings of the meetings of the stockholders and directors in a book to be kept for that purpose, and shall give notice as required by statute or these By-laws of all such meetings. The Secretary shall have custody of the seal of the Corporation and of all books, records, and papers of the Corporation, except such as shall be in the charge of the Treasurer or of some other person authorized to have custody and possession thereof by resolution of the Board of Directors. The Secretary may, together with the President, execute on behalf of the Corporation any contract which has been approved by the Board of Directors. The Secretary shall also have such other powers and perform such other duties as are incident to the office of the secretary of a corporation or as shall from time to time be prescribed by, or pursuant to authority delegated by, the Board of Directors.

Section 3.5Treasurer. The Treasurer shall keep full and accurate accounts of the receipts and disbursements of the Corporation in books belonging to the Corporation, shall deposit all moneys and other valuable effects of the Corporation in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors, and shall also have such other powers and perform such other duties as are incident to the office of the treasurer of a corporation or as shall from time to time be prescribed by, or pursuant to authority delegated by, the Board of Directors.

Section 3.6Other Officers and Assistant Officers. The powers and duties of each other officer or assistant officer who may from time to time be chosen by the Board of Directors shall be as specified by, or pursuant to authority delegated by, the Board of Directors at the time of the appointment of such other officer or assistant officer or from time to time thereafter. In addition, each officer designated as an assistant officer shall assist in the performance of the duties of the officer to which he or she is assistant, and shall have the powers and perform the duties of such officer during the absence or inability to act of such officer.

Section 3.7Term and Compensation. Officers shall be elected by the Board of Directors from time to time, to serve at the pleasure of the Board. Each officer shall hold office until his or her successor is elected and qualified, or until his or her earlier resignation or removal. The compensation of all officers shall be fixed by, or pursuant to authority delegated by, the Board of Directors from time to time.

ARTICLE IV

INDEMNIFICATION

Section 4.1Directors and Officers. The Corporation shall indemnify, to the fullest extent now or hereafter permitted by law, each director, officer and other persons who the Corporation is empowered to indemnify (including each former director or officer) of the Corporation who was or is made a party to or witness in or is threatened to be made a party to or a witness in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he is or was an authorized representative of the Corporation, against all expenses (including attorneys’ fees and disbursements), judgments, fines (including excise taxes and penalties) and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding.

Section 4.2Payment of Expenses. The Corporation shall pay expenses (including attorneys’ fees and disbursements) incurred by a director or officer of the Corporation referred to in Section 4.1 hereof in defending or appearing as a witness in any civil or criminal action, suit or proceeding described in Section 4.1 hereof in advance of the final disposition of such action, suit or proceeding. The expenses incurred by such director or officer in his capacity as a director or officer of the Corporation shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding only upon receipt of an undertaking by or on behalf of such director or officer to repay all amounts in advance if it shall ultimately be determined that he is not entitled to be indemnified by the Corporation because he has not met the standard or conduct set further in the first sentence of Section 4.5 hereof.

Section 4.3Permissive Indemnification and Advancement of Expenses. The Corporation may, as determined by the Board of Directors from time to time, indemnify to the fullest extent now or hereafter permitted by law, any person who was or is a party to or a witness in or is threatened to be made a party to or a witness in, or is otherwise involved in, any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he is or was an authorized representative of the Corporation, against all expenses (including attorneys’ fees and disbursements),

judgments, fines (including excise taxes and penalties), and amounts paid in settlement actually and reasonably incurred by him in connection with such action, suit or proceeding. Subject to Section 4.2 hereof, the Corporation may, as determined by the Board of Directors from time to time, pay expenses incurred by any such person by reason of his participation in an action, suit or proceeding referred to in this Section 4.3 in advance of the final disposition of such action, suit or proceeding. Section 4.4. Basis of Rights; Other Rights. Each director and officer of the Corporation shall be deemed to act in such capacity in reliance upon such rights of indemnification and advancement of expenses as are provided in this Article. The rights of indemnification and advancement of expenses provided by this Article shall not be deemed exclusive of any other rights to which any person seeking indemnification or advancement of expenses may be entitled under any agreement, vote of stockholders or disinterested directors, statute or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office or position, and shall continue as to a person who has ceased to be an authorized representative of the Corporation and shall inure to the benefit of the heirs, executors and administrators of such person.

Section 4.4Determination of Indemnification. Any indemnification under this Article shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the authorized representative is proper in the circumstances because such person has acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. Such determination shall be made (1) by the Board of Directors by a majority vote of a quorum consisting of Directors who were not parties to such action, suit or proceeding, or (2) quorum of disinterested Directors so directs, by independent legal counsel in a written opinion, or (3) by the stockholders. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, or itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s conduct was unlawful.

Section 4.5Insurance. The Corporation shall purchase and maintain insurance on behalf of each director and officer against any liability asserted against or incurred by such director or officer in any capacity, or arising out of such director’s or officer’s status as such, whether or not the Corporation would have the power to indemnify such director or officer against such liability under the provisions of this Article. The Corporation shall not be required to maintain such insurance if it is not available on terms satisfactory to the Board of Directors or if, in the business judgment of the Board of Directors, either (i) the premium cost for such insurance is substantially disproportionate to the amount of coverage, or (ii) the coverage provided by such insurance is so limited by exclusions that there is insufficient benefit from such insurance. The Corporation may purchase and maintain insurance on behalf of any person referred to in Section 4.3 hereof against any liability asserted against or incurred by such person in any capacity, whether or not the Corporation would have the power to indemnify such persons against such liability under the provisions of this Article.

Section 4.6Powers of the Board. The Board of Directors, without approval of the stockholders, shall have the power to borrow money on behalf of the Corporation, including the power to pledge the assets of the Corporation, from time to time to discharge the Corporation’s obligations with respect to indemnification, the advancement and reimbursement of expenses, and the purchase and maintenance of insurance referred to in this Article IV.

Section 4.7Definition - Corporation. For purposes of this Article, references to “the Corporation” shall include, in addition to the resulting corporation, and constituent corporation (including any constituent of a constituent) absorbed in consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its authorized representatives so that any person who is or was an authorized representative of such constituent corporation shall stand in the same position under this Article with respect to the resulting or surviving corporation as he would have with respect to such constituent corporation if its separate existence had continued.

Section 4.8Definition - Authorized Representative. For the purposes of this Article, the term “authorized representative” shall mean a director, officer, employee or agent of the Corporation or of any subsidiary of the Corporation, or a trustee, custodian, administrator, committeeman or fiduciary of any employee benefit plan established and maintained by the Corporation or by any subsidiary of the Corporation, or a person serving another corporation, partnership, joint venture, trust or other enterprise in any of the foregoing capacities at the request of the Corporation.

ARTICLE V

SHARES OF CAPITAL STOCK

Section 5.1Issuance of Stock. Shares of capital stock of any class now or hereafter authorized, securities convertible into or exchangeable for such stock, or options or other rights to purchase such stock or securities may be issued or granted in accordance with authority granted by resolution of the Board of Directors.

Section 5.2Stock Certificates. Certificates for shares of the capital stock of the Corporation shall be in the form adopted by the Board of Directors, shall be signed by the Chief Executive Officer, President or Vice President and by the Secretary, Assistant Secretary, Treasurer or Assistant Treasurer and may be sealed with the seal of the Corporation. All such certificates shall be numbered consecutively, and the name of the person owning the shares represented thereby, with the number of such shares and the date of issue, shall be entered on the books of the Corporation.

Section 5.3Transfer of Stock. Shares of capital stock of the Corporation shall be transferred only on the books of the Corporation, by the holder of recor in person or by the holder’s duly authorized representative, upon surrender to the Corporation of the certificate for such shares duly endorsed for transfer, together with such other documents (if any) as may be required to effect such transfer.

Section 5.4Lost, Stolen, Destroyed, or Mutilated Certificates. New stock certificates may be issued to replace certificates alleged to have been lost, stolen, destroyed, or mutilated, upon such terms and conditions, including proof of loss or destruction, and the giving of a satisfactory bond of indemnity, as the Board of Directors from time to time may determine.

Section 5.5Regulations. The Board of Directors shall have power and authority to make all such rules and regulations not inconsistent with these By-laws as it may deem expedient concerning the issue, transfer, and registration of shares of capital stock of the Corporation.

Section 5.6Holders of Record. The Corporation shall be entitled to treat the holder of record of any share or shares of capital stock of the Corporation as the holder and owner in fact thereof for all purposes and shall not be bound to recognize any equitable or other claim to, or right, title, or interest in, such share or shares on the part of any other person, whether or not the Corporation shall have express or other notice thereof, except as otherwise provided by the laws of the State of Delaware.

Section 5.7Restriction on Transfer. A restriction on the hypothecation, transfer or registration of transfer of shares of the corporation may be imposed either by these By-laws or by an agreement among any number of stockholders or such holders and the corporation. No restriction so imposed shall be binding with respect to those securities issued prior to the adoption of the restriction unless the holders of such securities are parties to an agreement or voted in favor of the restriction.

ARTICLE VI

GENERAL PROVISIONS

Section 6.1Corporate Seal. The Corporation may adopt a seal in such form as the Board of Directors shall from time to time determine.

Section 6.2Fiscal Year. The fiscal year of the Corporation shall be as designated by the Board of Directors from time to time.

Section 6.3Authorization. All checks, notes, vouchers, warrants, drafts, acceptances, and other orders for the payment of moneys of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

Section 6.4Financial Reports. Financial statements or reports shall not be required to be sent to the stockholders of the Corporation, but may be so sent in the discretion of the Board of Directors, in which event the scope of such statements or reports shall be within the discretion of the Board of Directors, and such statements or reports shall not be required to have been examined by or to be accompanied by an opinion of an accountant or firm of accountants.

Section 6.5Effect of By-laws. No provision in these By-laws shall vest any property right in any stockholder.

ARTICLE VII
AMENDMENTS

The authority to adopt, amend or repeal By-laws of the Corporation is expressly conferred upon the Board of Directors, which may take such action by the affirmative vote of a majority of the whole Board of Directors at any regular or special meeting duly convened after notice of that purpose, subject always to the powers of the stockholders to adopt, amend or repeal By-laws.

AMENDMENT NO. 1

TO

AMENDED AND RESTATED BY-LAWS

OF

CINEDIGM CORP.

Amendment No. 1 to the amended and restated by-laws (the “By-laws”) of Cinedigm Corp., a Delaware corporation (the “Corporation”).

Pursuant to the resolution of the Board of Directors of the Corporation (the “Board of Directors”), dated July 30, 2015, Section 2.2 of the By-laws is hereby amended as follows:

1.    The first sentence of Section 2.2 shall be revised and amended to read as follows:

“The Board of Directors shall consist of not less than two (2) nor more than twelve (12) members as fixed from time to time by the Board of Directors.”

    2.    This Amendment shall be effective as of July 30, 2015.

3.    In all respects not amended, the By-laws are hereby ratified and confirmed and remain in full force and effect.

CINEDIGM CORP.
By:	/s/ Gary S. Loffredo
Name:	Gary S. Loffredo
Title:	President, Digital Cinema, General Counsel and Secretary

Amendment No. 1

TO

AMENDED AND RESTATED By-laws

Of

Cinedigm Corp.

Amendment No. 1 to the amended and restated by-laws (the “By-laws”) of Cinedigm Corp., a Delaware corporation (the “Corporation”).

Pursuant to the resolution of the Board of Directors of the Corporation (the “Board of Directors”), dated July 30, 2015, Section 2.2 of the By-laws is hereby amended as follows:

1.The first sentence of Section 2.2 shall be revised and amended to read as follows:

“The Board of Directors shall consist of not less than two (2) nor more than twelve (12) members as fixed from time to time by the Board of Directors.”

2.This Amendment shall be effective as of July 30, 2015.

3.In all respects not amended, the By-laws are hereby ratified and confirmed and remain in full force and effect.

CINEDIGM CORP.
By:	/s/ Gary S. Loffredo
Name:	Gary S. Loffredo
Title:	President, Digital Cinema, General Counsel and Secretary

EX-10.1

EXECUTION COPY

CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED BASED ON A REQUEST FOR CONFIDENTIAL TREATMENT

OMITTED PORTIONS HAVE BEEN SEPARATELY FILED WITH THE SECURITIES AND EXCHANGE COMMISSION

CONFIDENTIAL SETTLEMENT AGREEMENT AND RELEASE

This Confidential Settlement Agreement and Release (the “Settlement Agreement”) is made and entered into by and between Gaiam, Inc. and Gaiam Americas, Inc. (collectively referred to as “Gaiam”) and Cinedigm Corp. and Cinedigm Entertainment Holdings, LLC (collectively referred to as “Cinedigm”) as of September 29, 2015 (the “Effective Date”). Gaiam and Cinedigm are referred to in this Settlement Agreement individually as a “Party” and collectively as the “Parties.”

1.BACKGROUND FACTS

This Settlement Agreement is made in light of the following facts:

1.1 As of approximately October 17, 2013, the Parties entered into the Membership Interest Purchase Agreement (“MIPA”), the Transition Services Agreement (“TSA”), the Cash Allocation Agreement (“CAA”), the Escrow Agreement, and the Contribution Agreement (collectively, and including any amendments to the foregoing, the “Agreements”) in connection with Cinedigm’s acquisition of Gaiam’s entertainment media business (or “EMB”) (herein, the “Acquisition”);

1.2 After the Acquisition’s closing, Gaiam provided certain services to Cinedigm pursuant to the TSA and the CAA (the “TSA/CAA Services”);

1.3 On January 19, 2015, Gaiam filed a Demand for Arbitration with the American Arbitration Association (“AAA”), and several days later Cinedigm filed a Counterclaim (which was subsequently amended), and the action was styled as Gaiam, Inc., et al. v. Cinedigm Corp., et al., Case No. 01-15-0002-4437 (the “AAA Arbitration”);

1.4 On February 11, 2015, Cinedigm filed a state court complaint to compel Gaiam to participate in a working capital arbitration, which was removed on March 4, 2015 to the United States District Court for the Central District of California and was thereafter styled as Cinedigm Corp., et al. v. Gaiam, Inc., et al., Case No. 2:15-cv-01557-SJO-AS (the “Court Litigation”).

1.5 Pursuant to an engagement letter entered into as of May 15, 2015, the parties commenced a working capital arbitration before Mr. Troy Dahlberg of KPMG (“KPMG”), and a Final Determination was issued as of September 11, 2015 (the “Working Capital Arbitration”);

Now, therefore, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

2.SETTLEMENT OBLIGATIONS

2.1 Within three (3) business days after the Effective Date, the Parties shall file a joint stipulation and proposed order with the arbitrator in the AAA Arbitration to dismiss all claims and counterclaims in the AAA Arbitration with prejudice, and with each side bearing its own fees and costs.

2.2 Gaiam will not seek to confirm the arbitration award issued by KPMG in the Working Capital Arbitration, or to otherwise demand payment thereunder. The Parties agree to bear their own fees and costs in connection with the Working Capital Arbitration.

2.3 Within fourteen (14) business days after the Effective Date, Gaiam will pay $2.3 million (Two Million Three Hundred Thousand Dollars) to Cinedigm via wire payment to the following account, as follows:

ACCOUNT NAME:

CINEDIGM CORPORATION CONCENTRATION ACCOUNT

ACCOUNT NUMBER:

ABA NUMBER:

322270288

SWIFT CODE:

OWBKUS6L

BANK:

CIT Bank, N.A.,
888 East Walnut StreetPasadena, CA 91101Contact: Joel Martinez, Assistant Vice President Client Banking ServicesTel: 626-535-2331

2.4 The Parties agree that they will conduct a further arbitration (herein, the “Reconciliation Arbitration”). In this regard, Cinedigm alleges that Gaiam has improperly retained cash received after the Acquisition’s closing relating to the EMB and which is owed to Cinedigm, as reflected by the amounts identified in lines A through T of the chart entitled “Accounts Receivable Reconciliation” and submitted by Cinedigm in connection with the September 13, 2015 mediation, and which is attached hereto as Exhibit A. Gaiam, for its part, denies that Cinedigm’s allegations have any merit and further disagrees with (1) the dollar amounts listed on lines A through T of Exhibit A; (2) the descriptions and categorizations that appear on lines A through T of Exhibit A; and (3) Cinedigm’s assertion that lines A through T of Exhibit A constitute the entire universe of transactions relevant to its contentions. The Parties, however, have agreed that the following provisions shall govern the Reconciliation Arbitration:

2

CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

2.4.1 The arbitrator’s sole task (and sole authority) in the Reconciliation Arbitration shall be to calculate the Cash Remittance Shortfall (if any).

2.4.2 “Cash Remittance Shortfall” shall mean the amount (if any) by which Gaiam’s EMB Post-Closing Cash Receipts exceed Gaiam’s EMB Post-Closing Remittances. “Gaiam’s EMB Post-Closing Cash Receipts” shall mean cash actually received by Gaiam after closing in payment of “Media Co. Receivables” (as defined by the MIPA and by the CAA). Gaiam’s EMB Post-Closing Cash Receipts expressly include cash receipts for receivables identified in the final calculation of Closing Working Capital and cash receipts for Media Co Receivables from post-Acquisition sales, but expressly exclude the $2,000,000 that Gaiam was contractually entitled to retain under the MIPA with respect to Netflix receivables. For the avoidance of doubt, Gaiam’s allocation of and accounting for Gaiam’s EMB Post-Closing Cash Receipts shall be considered by the arbitrator in order to calculate the Cash Remittance Shortfall (if any). “Gaiam’s EMB Post-Closing Remittances” shall mean monies that Gaiam remitted directly to Cinedigm or to the “Escrow Account” (as defined in the MIPA) for distribution to Cinedigm as specified by the CAA.

2.4.3 For the avoidance of doubt, the purported validity or invalidity of any receivable (including any chargeback debit memo) under GAAP or otherwise, including whether a receivable (or chargeback debit memo) is “collectible,” shall not be considered by the arbitrator. By way of example, and not by limitation, the arbitrator shall not consider lines U through Z of Exhibit A to this Settlement Agreement. It is expressly agreed that such matters are outside the scope of the Reconciliation Arbitration.

2.4.4 The Parties shall mutually select a single arbitrator (“Arbitrator”), who must be a CPA presently employed by a recognized firm capable of serving as an accounting expert and who must have experience with accounting for sales of retail consumer products, to preside over the Reconciliation Arbitration. This selection shall occur within 15 days after the Effective Date. The Parties further agree that the Arbitrator may, in his or her discretion, retain an independent consultant (who must be jointly approved by the Parties) who has knowledge regarding the physical and digital distribution of retail consumer products, including the process of reconciling accounts receivable with chargebacks and other debits, in order to assist with the Reconciliation Arbitration (“Independent Consultant”).

2.4.5 The Parties agree that any documents that they produced or used in the Working Capital Arbitration and/or in the AAA Arbitration may be used in the Reconciliation Arbitration. Additionally, subject to the entry of a non-disclosure agreement, the Parties agree to provide the Arbitrator with access to any non-attorney-client-privileged information that the Arbitrator deems necessary to conduct the Reconciliation Arbitration and to calculate the Cash Remittance Shortfall, including non-privileged information related to Gaiam’s separate fitness business and Gaiam’s accounting records and information related to Cinedigm’s consolidated

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CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

entertainment business and Cinedigm’s accounting records. The Parties will also provide all such information provided to the Arbitrator to the other Party.

2.4.6 The Arbitrator shall have the authority to conduct the Reconciliation Arbitration in the manner that he or she deems appropriate. The Parties, however, will be afforded the opportunity to submit initial briefs setting forth their respective positions in writing, as well as the opportunity to file replies to the initial briefs. To the extent the Arbitrator deems oral argument to be necessary, oral argument in the Reconciliation Arbitration shall be held as requested by the Arbitrator. The Arbitrator will use his or her best efforts to complete the arbitration process no later than 60 days after the Arbitrator has been selected. The Parties shall also request that the Arbitrator issue a reasoned award.

2.4.7 ***

2.4.8 Within five (5) business days after the Arbitrator renders the final award in the Reconciliation Arbitration, the Parties will notify each other as to whether they intend to file a petition to vacate and/or modify the final award. If neither Party provides notice of its intent to file such a petition within the foregoing period, Gaiam will, within five (5) business days thereafter, pay to Cinedigm the Cash Remittance Shortfall, consistent with and subject to the limitations identified in paragraph 2.4.7 above, via wire payment as described in paragraph 2.3 above. If Gaiam provides notice of its intent to file such a petition within the foregoing period, Gaiam will pay to Cinedigm $1.0 million of the Cash Remittance Shortfall identified in the Arbitrator’s final award, representing the minimum award allowable under paragraph 2.4.7 above, within five (5) business days after providing such notice of intent.

2.4.9 Each side shall bear its own fees and costs in connection with the Reconciliation Arbitration, and shall split the Arbitrator’s fees equally (as well as any fees incurred by an Independent Consultant).

3.RELEASE

3.1 Release of Claims.

3.1.1 Except for the obligations under this Settlement Agreement, Gaiam, on behalf of itself and on behalf of each of its predecessors, successors, parents, subsidiaries, and affiliated or related companies, and each of their respective present and former officers, directors, employees, representatives, agents, attorneys, insurers, and assigns, and each of them (the “Gaiam Releasing Parties”), hereby knowingly and voluntarily fully and forever releases and discharges Cinedigm and its predecessors, successors, parents, subsidiaries, and affiliated or related companies,

*** CONFIDENTIAL PROVISIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS.

4

CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

3.1.2 and each of their respective present and former officers, directors, employees, representatives, agents, attorneys, insurers, and assigns, and each of them (the “Cinedigm Releasees”), from any and all claims, demands, liens, actions, suits, causes of action, obligations, controversies, debts, costs, attorneys’ fees, expenses, damages, judgments, orders, and liabilities of whatever kind or nature in law, equity, or otherwise, by reason of any matter, cause, or thing whatsoever, whether now known or unknown, suspected or unsuspected, subject to dispute or otherwise, from the beginning of time through the Effective Date, that the Gaiam Releasing Parties, or any of them, may have had, now have, or may hereafter purport to have against the Cinedigm Releasees, or any of them, including, without limitation, with respect to any matters arising out of, in connection with, or related to the Agreements, the Acquisition, the TSA/CAA Services, the AAA Arbitration, the Court Litigation, and/or the Working Capital Arbitration (the “Gaiam Released Claims”).

3.1.3 Except for the obligations under this Settlement Agreement, Cinedigm, on behalf of itself and on behalf of each of its predecessors, successors, parents, subsidiaries, and affiliated or related companies, and each of their respective present and former officers, directors, employees, representatives, agents, attorneys, insurers, and assigns, and each of them (the “Cinedigm Releasing Parties”), hereby knowingly and voluntarily fully and forever releases and discharges Gaiam and its predecessors, successors, parents, subsidiaries, and affiliated or related companies, and each of their respective present and former officers, directors, employees, representatives, agents, attorneys, insurers, and assigns, and each of them (the “Gaiam Releasees”), from any and all claims, demands, liens, actions, suits, causes of action, obligations, controversies, debts, costs, attorneys’ fees, expenses, damages, judgments, orders, and liabilities of whatever kind or nature in law, equity, or otherwise, by reason of any matter, cause, or thing whatsoever, whether now known or unknown, suspected or unsuspected, subject to dispute or otherwise, from the beginning of time through the Effective Date, that the Cinedigm Releasing Parties, or any of them, may have had, now have, or may hereafter purport to have against the Gaiam Releasees, or any of them, including, without limitation, with respect to any matters arising out of, in connection with, or related to the Agreements, the Acquisition, the TSA/CAA Services, the AAA Arbitration, the Court Litigation, and/or the Working Capital Arbitration (the “Cinedigm Released Claims”).

3.1.4 The term “Releasing Parties” means, as applicable, the Gaiam Releasing Parties and/or the Cinedigm Releasing Parties. The term “Releasees” means, as applicable, the Gaiam Releasees and/or the Cinedigm Releasees. The term “Released Claims” means, as applicable, the Gaiam Released Claims and/or the Cinedigm Released Claims.

3.2 Other or Additional Facts. The Releasing Parties expressly and knowingly acknowledge that they may hereafter discover facts different from or in addition to those which they now know or believe to be true with respect to the Released Claims, and which, if known to them

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CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

at the time they executed this Settlement Agreement, may have materially affected their decision to execute this Settlement Agreement. The Releasing Parties acknowledge and agree that by reason of this Settlement Agreement and the releases contained herein, they are voluntarily, knowingly, and after receiving the advice of counsel assuming any risk of such unknown facts and such unknown and unsuspected claims and that this Settlement Agreement shall be and shall remain in full force and effect in all respects.

3.3 Unknown Claims. The Releasing Parties further acknowledge that they have been advised of the existence of § 1542 of the California Civil Code, which provides:

A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.

Notwithstanding such provision, this Settlement Agreement shall constitute a full release of the Released Claims in accordance with its terms. The Releasing Parties knowingly and voluntarily waive the provisions of § 1542, as well as any other statute, law, or rule of similar effect.

3.4 Covenant Not to Sue. Except for the Reconciliation Arbitration and/or for the purpose of otherwise enforcing the terms of this Settlement Agreement, the Releasing Parties agree to refrain and forbear forever from commencing, instituting, prosecuting, or directly or indirectly participating in, or filing any claim for damages or demand in connection with, any lawsuit, action, or proceeding against the Releasees, or any of them, based upon any of the Released Claims.

4.GENERAL PROVISIONS

4.1 Successors in Interest. This Settlement Agreement, including the releases herein contained, shall be binding upon and inure to the benefit of the Parties and each of their successors-in-interest, including, without limitation, heirs, permitted assigns, and beneficiaries.

4.2 No Assignment or Transfer.

4.2.10 Gaiam represents and warrants that no other person or entity has, or has had, any interest in any of the Gaiam Released Claims; that it has the sole rights and exclusive authority to execute this Settlement Agreement on behalf of the Gaiam Releasing Parties; and that it has not sold, assigned, transferred, conveyed, or otherwise disposed of any of the Gaiam Released Claims.

4.2.11 Cinedigm represents and warrants that no other person or entity has, or has had, any interest in any of the Cinedigm Released Claims; that it has the sole rights and exclusive authority to execute this Settlement Agreement on behalf of the Cinedigm Releasing Parties; and that it has not sold, assigned, transferred, conveyed, or otherwise disposed of any of the Cinedigm Released Claims.

6

CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

4.2.12 Each Party agrees to indemnify, defend, and hold harmless any person or entity released by such Party in this Settlement Agreement, against all claims, demands, controversies, liabilities, damages, debts, obligations, costs, expenses, losses, compensation, reasonable outside attorneys’ fees, and causes of action of any kind or nature, in law or in equity, incurred by such person or entity as a result of any other person or entity asserting any such claim, complaint, or right, or any such assignment, transfer, conveyance, or other disposition of any of the Released Claims by such Party.

4.3 No Admission of Liability. This Settlement Agreement does not constitute an admission by any of the Releasees of any liability or wrongdoing whatsoever.

4.4 Mutually Drafted Settlement Agreement. Each of the Parties has been fully and competently represented by counsel of their own choosing in the negotiations and drafting of this Settlement Agreement. Accordingly, the Parties agree that any rule of construction of contracts resolving any ambiguities against the drafting Party shall be inapplicable to this Settlement Agreement. Each term of this Settlement Agreement is contractual, not a mere recital, and is the result of negotiations between the Parties.

4.5 Final Written Expression. This Settlement Agreement is integrated and once accepted according to its terms is intended by the Parties as a final and complete expression of their agreement with respect to the subject matter addressed herein. This Settlement Agreement supersedes any and all prior or contemporaneous agreements, negotiations, or understandings, written or oral, between the Parties regarding the subject matter addressed herein. The Parties hereto, and each of them, acknowledge that no other Party nor any agent or attorney for any other Party has made any promise, representation, or warranty whatsoever, express or implied, written or oral, not contained herein, concerning the subject matter hereof to induce the execution of this Settlement Agreement, and each of the Parties acknowledges that it has not executed this Settlement Agreement in reliance on any promise, representation, or warranty not contained herein.

4.6 Amendment. This Settlement Agreement may not be amended, modified, or terminated, in whole or in part, except by an instrument in writing duly executed by the Parties or their authorized representatives.

4.7 Confidentiality. Except as set forth below, the Parties agree to keep confidential and not disclose, describe, or discuss, either directly or indirectly, in any manner whatsoever, any information regarding the terms or substance of this Settlement Agreement to or with any person or entity. The Parties may disclose only that the dispute was satisfactorily resolved.

4.7.1 Notwithstanding the provisions of paragraph 4.7 above, the Parties may disclose in confidence to their Board of Directors, employees, lawyers, accountants, insurers, financial advisors, creditors, and consultants such information concerning the terms of this Settlement Agreement as is necessary for such individuals to perform their professional functions, such information as may be required for compliance with statute or regulation or requested by governmental or regulatory authorities, such

7

CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

information as may be necessary to defend legal action brought by third parties, and such information as may be necessary to enforce this Settlement Agreement.

4.7.2 If disclosure of the terms of this Settlement Agreement is sought by court order, subpoena, or via some other discovery request, the Party from whom such disclosure is sought may make such disclosure, provided that said Party first notifies the other Party in writing as soon as practicable, but in no event later than five (5) business days from the date of service or the receipt of the court order, subpoena, or other discovery request, and, to the extent possible, no later than three (3) business days prior to the requested production. The Party from whom disclosure is sought shall not oppose any effort by the other Party for a protective order or other relief from the court order or subpoena.

4.8 Non-Disparagement. The Parties shall not disparage the Releasees regarding the subject matter of the Released Claims or the Reconciliation Arbitration.

4.9 Waiver. Any waiver of any term of this Settlement Agreement must be in writing and signed by the Party waiving its rights hereunder. Conduct that is arguably or actually inconsistent with rights granted under this Settlement Agreement shall not constitute a waiver unless an intent to waive rights under this Settlement Agreement is clearly expressed in writing as required by this paragraph. The waiver of any term or condition contained in this Settlement Agreement shall not be construed as a waiver of any other term or condition contained in this Settlement Agreement.

4.10 Warranty of Independent Advice. Each Party warrants and represents that it has received independent legal advice from such Party’s attorney with respect to the rights and obligations arising from, and the advisability of executing, this Settlement Agreement and with respect to the waiver of Section 1542 of the California Civil Code.

4.11 Warranty of Due Authorization. Each Party warrants and represents that such Party is fully entitled and duly authorized to enter into and deliver this Settlement Agreement. In particular, and without limiting the generality of the foregoing, each Party warrants and represents that it is fully entitled to grant the releases and undertake the obligations set forth herein.

4.12 Warranty of Power. Each Party warrants and represents that it is duly organized and validly existing under the laws of the state or nation of its incorporation or formation, and that it has full power and authority to enter into this Settlement Agreement and carry out the provisions hereof.

4.13 No Third Party Beneficiaries. No person or entity shall be considered a third party beneficiary of, or otherwise entitled to any rights or remedies under this Settlement Agreement, except with respect to the releases expressly provided for herein.

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CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

4.14 Governing Law. This Settlement Agreement shall be governed by, construed, and enforced in accordance with the laws of the State of California, without giving effect to its choice of law provisions.

4.15 Severability. If any provision of this Settlement Agreement is declared invalid by any tribunal, then such provision shall be deemed automatically adjusted to the minimum extent necessary to conform to the requirements for validity as declared at such time and, as so adjusted, shall be deemed a provision of this Settlement Agreement as though originally included herein. In the event that the provision invalidated is of such a nature that it cannot be so adjusted, the provision shall be deemed deleted from this Settlement Agreement as though such provision had never been included herein. In either case, the remaining provisions of this Settlement Agreement shall remain in full force and effect.

4.16 Gender/Plural/Connectives. Whenever in this Settlement Agreement the context may require, the masculine gender shall be deemed to include the feminine and/or neuter, and vice versa, the singular to include the plural, and vice versa, and (to give the releases herein the broadest interpretation and scope, as is desired by the Parties hereto) the connectives “and” and “or” to mean “and/or.”

4.17 Attorneys’ Fees/Costs. All Parties shall bear their own attorneys’ fees, expenses, and costs in connection with, related to, or arising from this Settlement Agreement or otherwise relating to the matters released herein.

4.18 Headings. Headings as used in this Settlement Agreement are for convenience only and are not a part of this Settlement Agreement. The Parties acknowledge that they have read the full substance of each paragraph and are not relying upon the headings.

4.19 Notices. Any notice appropriate or required to be given hereunder shall be by Federal Express and email, or, in the alternative, at the option of the sender, by messenger, and shall be to the following addresses, or such other address as is subsequently noticed in writing to all Parties:

If to Gaiam:

Bert H. DeixlerKendall Brill & Kelly LLPSanta Monica Blvd., Suite 1725Los Angeles, CA 90067bdeixler@kbkfirm.com

AND

John Jackson|Gaiam, Inc.833 W. South Boulder Road

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CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

Louisville, CO 80027john.jackson@gaiam.com

If to Cinedigm:

Patricia GlaserGlaser Weil Fink Howard Avchen & Shapiro LLPConstellation Blvd., 19^th FloorLos Angeles, CA 90067pglaser@glaserweil.com

AND

Gary S. LoffredoCinedigm Corp.Broadway, 9^th Floor
New York, NY 10010 gloffredo@cinedigm.com

4.20 Execution in Counterparts. The Parties may execute this Settlement Agreement by facsimile or PDF and in counterparts, each one of which shall have the same force and effect as an original, and all of which together shall constitute one and the same instrument.

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CONFIDENTIAL TREATMENT REQUESTED BY CINEDIGM CORP. OF CERTAIN PROVISIONS OF THISAGREEMENT IN ACCORDANCE WITH RULE 24B-2 UNDER THE SECURITIES EXCHANGE ACT OF 1934.

IN WITNESS WHEREOF, the Parties have each caused this Settlement Agreement to be duly executed as of the Effective Date.

Dated:	September 30, 2015	GAIAM, INC. By: /s/ J. Johnson Its: EVP
Dated:	September 30, 2015	GAIAM AMERICAS, INC. By: /s/ J. Johnson Its: EVP
Dated:	September 29, 2015	CINEDIGM CORP. By: /s/ Adam M. Mizel Its: COO
Dated:	September 29, 2015	CINEDIGM ENTERTAINMENT HOLDINGS, LLC By: /s/ Adam M. Mizel Its: COO

11

EXHIBIT A

Exhibit A to Settlement Agreement

Accounts Receivable Reconciliation

Accounts Receivable Reconciliation Total			Per OBS Amount		Source
Accounts Receivable Outstanding	A	***		Gaiam Opening Balance Sheet
Chargebacks	B	***		Gaiam Opening Balance Sheet
Gross A/R Per OBS	C = A+B	***
Less: Reserve Accrual Pre-Closing	D	***		Gaiam Opening Balance Sheet
Total OBS A/R, Net	E = C+D	***
Total Gross Sales Post Closing	F	***		Diver Sales Data October ’13 -May ‘14
Less: Returns Post-Closing	G	***		Diver Sales Data October ’13 -May ‘14
Amounts Reserved For on OBS	H	***		See “D” above
Net Sales Post Closing	I = F+G+H	***
Total Expected Cash Collections	J = E+I	***
Total CM’s Issued to Clear Non-Return DM’s	K	***		“CDGM All Debit and Credit Memos” File
Open Debit Memos - Non Return	L	***		“CDGM All Debit and Credit Memos” File
Open Debit Memos - Return	M	***		“CDGM All Debit and Credit Memos” File
Open Debit Memos - Post 5/31/2014	N	***		Gaiam Payment Sheets
Total Outstanding Amounts	O = K+L+M+N	***
Total Net Cash Collections Due	P = J+O	***
Total Payments Collected by Gaiam / Direct	Q	***		Societe Generale Deposits
Additional Amounts to be Collected	R	***		***
*** Holdback per MIPA Cash Shortfall	S T = P+Q+R+S	***		MIPA - Section 2.02(c)(i)
		***
Open Credit Memos to be Accepted	U	***		“CDGM All Debit and Credit Memos” File
Open Non-Return Chargebacks (Rejected)	V	***		“CDGM All Debit and Credit Memos” File
Open Return Chargebacks Non *** (Rejected)	W	***		“CDGM All Debit and Credit Memos” File
Open Return Chargebacks *** (Rejected)	X	***		“CDGM All Debit and Credit Memos” File
*** Design - Not Owned Title	Y	***		Title Not Owned by CGDM - Posted to GL
Cash Amount Due to Cinedigm	Z = Sum(T:Y)	***

Page 5    

*** CONFIDENTIAL PROVISIONS HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. ASTERISKS DENOTE OMISSIONS

EX-31.1

EXHIBIT 31.1

CERTIFICATION

I, Christopher J. McGurk, certify that:

1. I have reviewed this Form 10-Q of Cinedigm Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	November 9, 2015	By:	/s/ Christopher J. McGurk
			Christopher J. McGurk Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATION

I, Jeffrey S. Edell, certify that:

1. I have reviewed this Form 10-Q of Cinedigm Corp.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	November 9, 2015	By:	/s/ Jeffrey S. Edell
			Jeffrey S. Edell Chief Financial Officer (Principal Financial Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with Form 10-Q of Cinedigm Corp. (the “Company”) for the period ended September 30, 2015 as filed with the SEC (the “Report”), the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

Date:	November 9, 2015	By:	/s/ Christopher J. McGurk
			Christopher J. McGurk Chief Executive Officer and Chairman of the Board of Directors (Principal Executive Officer)

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with Form 10-Q of Cinedigm Corp. (the “Company”) for the period ended September 30, 2015 as filed with the SEC (the “Report”), the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of the Company.

Date:	November 9, 2015	By:	/s/ Jeffrey S. Edell
			Jeffrey S. Edell Chief Financial Officer (Principal Financial Officer)

XML

STOCKHOLDERS' EQUITY - COMMON STOCK (Details) - shares	6 Months Ended
	Sep. 30, 2015	Mar. 31, 2015
Class A common stock
Class of Stock [Line Items]
Shares issued as payment for services rendered	679,379
Common stock, shares authorized	210,000,000	210,000,000
Class B common stock
Class of Stock [Line Items]
Common stock, shares authorized	1,241,000	1,241,000

XML

SEGMENT INFORMATION - RECONCILIATION OF OPERATING PROFIT (LOSS) (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Total consolidated revenues	$ 27,704	$ 23,721	$ 50,532	$ 46,578
Direct operating (excludes depreciation and amortization shown below)	8,388	3,311	15,680	11,815
Selling, general and administrative	9,509	8,213	18,327	15,811
Allocation of Corporate overhead	0	0	0	0
Provision for doubtful accounts	0	78	339	172
Restructuring, transition and acquisition expenses, net	63	817	196	1,763
Litigation Settlement, Expense		91		202
Goodwill impairment	(18,000)	0	(18,000)	0
Litigation settlement recovery, net of expenses	(1,208)		(410)
Depreciation and amortization of property and equipment	9,427	9,391	18,784	18,767
Amortization of intangible assets	1,463	1,464	2,922	3,349
Total operating expenses	45,642	23,365	73,838	51,879
Income (loss) from operations	(17,938)	356	(23,306)	(5,301)
Phase I
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Total consolidated revenues	9,721	8,812	17,863	18,296
Direct operating (excludes depreciation and amortization shown below)	333	221	558	465
Selling, general and administrative	85	183	338	278
Allocation of Corporate overhead	0	0	0	0
Provision for doubtful accounts	0	36	241	96
Restructuring, transition and acquisition expenses, net	0	0	0	0
Litigation Settlement, Expense		0		0
Goodwill impairment	0		0
Litigation settlement recovery, net of expenses	0		0
Depreciation and amortization of property and equipment	7,151	7,138	14,304	14,275
Amortization of intangible assets	11	12	19	23
Total operating expenses	7,580	7,590	15,460	15,137
Income (loss) from operations	2,141	1,222	2,403	3,159
Phase II
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Total consolidated revenues	3,173	3,038	6,068	6,209
Direct operating (excludes depreciation and amortization shown below)	109	137	200	274
Selling, general and administrative	23	34	64	73
Allocation of Corporate overhead	0	0	0	0
Provision for doubtful accounts	0	34	98	55
Restructuring, transition and acquisition expenses, net	0	0	0	0
Litigation Settlement, Expense		0		0
Goodwill impairment	0		0
Litigation settlement recovery, net of expenses	0		0
Depreciation and amortization of property and equipment	1,881	1,881	3,762	3,762
Amortization of intangible assets	0	0	0	0
Total operating expenses	2,013	2,086	4,124	4,164
Income (loss) from operations	1,160	952	1,944	2,045
Services
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Total consolidated revenues	3,109	2,863	5,802	5,923
Direct operating (excludes depreciation and amortization shown below)	3	1	7	52
Selling, general and administrative	225	212	435	412
Allocation of Corporate overhead	405	459	807	925
Provision for doubtful accounts	0	8	0	21
Restructuring, transition and acquisition expenses, net	0	0	0	0
Litigation Settlement, Expense		0		0
Goodwill impairment	0		0
Litigation settlement recovery, net of expenses	0		0
Depreciation and amortization of property and equipment	0	53	0	106
Amortization of intangible assets	0	0	0	0
Total operating expenses	633	733	1,249	1,516
Income (loss) from operations	2,476	2,130	4,553	4,407
Content and Entertainment Segment [Member]
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Total consolidated revenues	11,701	9,008	20,799	16,150
Direct operating (excludes depreciation and amortization shown below)	7,943	2,952	14,915	11,024
Selling, general and administrative	5,768	4,717	10,996	9,100
Allocation of Corporate overhead	1,354	1,336	2,701	2,689
Provision for doubtful accounts	0	0	0	0
Restructuring, transition and acquisition expenses, net	0	576	0	1,418
Litigation Settlement, Expense		91		202
Goodwill impairment	(18,000)		(18,000)
Litigation settlement recovery, net of expenses	(1,208)		(410)
Depreciation and amortization of property and equipment	111	51	151	92
Amortization of intangible assets	1,449	1,451	2,899	3,324
Total operating expenses	33,417	11,174	49,252	27,849
Income (loss) from operations	(21,716)	(2,166)	(28,453)	(11,699)
Corporate
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Total consolidated revenues	0	0	0	0
Direct operating (excludes depreciation and amortization shown below)	0	0	0	0
Selling, general and administrative	3,408	3,067	6,494	5,948
Allocation of Corporate overhead	(1,759)	(1,795)	(3,508)	(3,614)
Provision for doubtful accounts	0	0	0	0
Restructuring, transition and acquisition expenses, net	63	241	196	345
Litigation Settlement, Expense		0		0
Goodwill impairment	0		0
Litigation settlement recovery, net of expenses	0		0
Depreciation and amortization of property and equipment	284	268	567	532
Amortization of intangible assets	3	1	4	2
Total operating expenses	1,999	1,782	3,753	3,213
Income (loss) from operations	$ (1,999)	$ (1,782)	$ (3,753)	$ (3,213)

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SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2014	Sep. 30, 2015
Supplemental Cash Flow Elements [Abstract]
Cash interest paid	$ 8,474	$ 6,571
Accrued dividends on preferred stock	178	89
Issuance of common stock for payment of preferred stock dividends	178	178
Deferred consideration recorded in connection with sale of business	$ 1,050	$ 0

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Other Interests (Details) - USD ($)	3 Months Ended			6 Months Ended
	Sep. 30, 2015	Jun. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Mar. 31, 2015
Noncontrolling Interest [Line Items]
Accounts Receivable Service Equity Investment	$ 400,000			$ 400,000		$ 336,000
Management Fees Revenue	300,000		$ 300,000	600,000	$ 600,000
Stockholders' Equity Attributable to Noncontrolling Interest	(754,000)			(754,000)		(178,000)
Net Income (Loss) Attributable to Noncontrolling Interest	(741,000)		$ 0	(1,175,000)	$ 0
Holdings [Member]
Noncontrolling Interest [Line Items]
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage		100.00%
Equity Method Investment, Aggregate Cost	2,000,000			2,000,000
Holdings [Member] | Variable Interest Entity, Not Primary Beneficiary [Member]
Noncontrolling Interest [Line Items]
Equity Method Investment Summarized Financial Information, Equity	9,700,000			9,700,000		6,700,000
Equity Method Investments	0			0		$ 0
CONtv [Member]
Noncontrolling Interest [Line Items]
Investments in and Advance to Affiliates, Subsidiaries, Associates, and Joint Ventures	$ 600,000			$ 600,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - NARRATIVE (Details) - USD ($)	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Jun. 30, 2015	Mar. 31, 2015
Deferred Revenue Arrangement [Line Items]
Fair Value Inputs, Federal and State Tax Rate			40.00%
Deferred Revenue, Recongnition Period			10 years
Accumulated deficit	$ (333,746,000)		$ (333,746,000)			$ (300,350,000)
Goodwill, Impairment Loss	$ (18,000,000)	$ 0	(18,000,000)	$ 0
Activation Fee Revenue, Per Screen			$ 2,000.0
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value	$ 0.35	$ 1.09	$ 0.52	$ 1.27
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount			29,135,181.00	29,113,797
Notes Payable	$ 79,667,000		$ 79,667,000			$ 45,294,000
Cinedigm Equity Incentive Plan [Member]
Deferred Revenue Arrangement [Line Items]
Issuance of common stock in connection with the exercise of warrants and stock options (shares)	0	6,673	25,000	41,066
Content and Entertainment Segment [Member]
Deferred Revenue Arrangement [Line Items]
Fair Value Inputs, Discount Rate			17.00%
Goodwill, Impairment Loss	$ (18,000,000)		$ (18,000,000)
Services
Deferred Revenue Arrangement [Line Items]
Goodwill, Impairment Loss	0		0
Administrative Fee VPFs					5.00%
Incentive Fees, Percentage of VPF Phase I					2.50%
Up-front Payment Arrangement [Member]
Deferred Revenue Arrangement [Line Items]
Administrative Fee VPFs					10.00%
New Accounting Pronouncement, Early Adoption, Effect [Member] | Long-term Debt [Member]
Deferred Revenue Arrangement [Line Items]
Deferred Finance Costs, Net	6,700,000		6,700,000
New Accounting Pronouncement, Early Adoption, Effect [Member] | Assets [Member]
Deferred Revenue Arrangement [Line Items]
Deferred Finance Costs, Net	$ (6,700,000)		(6,700,000)
Minimum [Member]
Deferred Revenue Arrangement [Line Items]
Activation Fee Revenue, Per Screen			1,000.0
Maximum [Member]
Deferred Revenue Arrangement [Line Items]
Activation Fee Revenue, Per Screen			$ 2,000.0

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STOCKHOLDERS' EQUITY - CINEDIGM'S EQUITY INCENTIVE PLAN (Details) - Cinedigm Equity Incentive Plan [Member] - $ / shares	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrange by Share-based Payment Award, Equity Incentive Plan, Percent Voting Power Threshold			10.00%
Share-based Compensation Arrange by Share-based Payment Award, Equity Incentive Plan, Exercise Price if Voting Threshold is Met, Percent			110.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period			4 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Remaining Contractual Term			6 years 9 months 11 days
Shares Under Option
Shares under option, beginning of period			5,908,670
Shares under option, granted			130,000
Shares under option, exercised	0	(6,673)	(25,000)	(41,066)
Shares under option, cancelled			(364,438)
Shares under option, end of period	5,649,232		5,649,232
Weighted Average Exercise Price Per Share
Weighted average exercise price per share, beginning of period			$ 1.72
Weighted average exercise price per share, granted			1.51
Weighted average exercise price per share, exercised			0.89
Weighted average exercise price per share, cancelled			1.92
Weighted average exercise price per share, end of period	$ 1.69		$ 1.69
Class A common stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized	14,300,000		14,300,000
Stock option
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage			25.00%

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NOTES PAYABLE - SUMMARY OF CREDIT FACILITIES (Details) $ in Thousands	6 Months Ended
	Sep. 30, 2015 USD ($) installments	Mar. 31, 2015 USD ($)
LIBOR
Line of Credit Facility [Line Items]
Line of Credit Facility, Interest Rate	0.33%
Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 53,523
Line of Credit Facility, Outstanding Principal Balance	$ 23,187	$ 27,010
Line of Credit Facility, Principal Payment, Number of Quarterly Installments | installments	28
Credit Facility 1 [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 22,336
Line of Credit Facility, Interest Rate	3.75%
Line of Credit Facility, Outstanding Principal Balance	$ 8,776	10,371
Credit Facility 2 [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 13,312
Line of Credit Facility, Interest Rate	3.75%
Line of Credit Facility, Outstanding Principal Balance	$ 5,705	6,656
Credit Facility 3 [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 11,425
Line of Credit Facility, Interest Rate	3.75%
Line of Credit Facility, Outstanding Principal Balance	$ 5,712	6,528
Credit Facility 4 [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 6,450
Line of Credit Facility, Interest Rate	3.75%
Line of Credit Facility, Outstanding Principal Balance	$ 2,994	$ 3,455

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SEGMENT INFORMATION - ASSETS and DEBT (Details)	6 Months Ended
	Sep. 30, 2015 USD ($) segments systems	Mar. 31, 2015 USD ($)
Segment Reporting, Asset Reconciling Item [Line Items]
Number of Reportable Segments | segments	4
Total intangible assets, net	$ 28,865,000	$ 31,784,000
Total goodwill	8,701,000	26,701,000
Assets from continuing operations	238,906,000	273,017,000
Notes payable, non-recourse	132,395,000	151,360,000
Current portion of notes payable	79,667,000	45,294,000
Capital leases	$ 5,193,000	5,495,000
Phase I
Segment Reporting, Asset Reconciling Item [Line Items]
Number of Systems Installed | systems	3,724
Phase I | Segment, Continuing Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total intangible assets, net	$ 233,000	252,000
Total goodwill	0	0
Assets from continuing operations	60,682,000	74,595,000
Notes payable, non-recourse	108,979,000	123,722,000
Current portion of notes payable	0	0
Capital leases	$ 0	0
Phase II
Segment Reporting, Asset Reconciling Item [Line Items]
Number of Systems Installed | systems	8,904
Phase II | Segment, Continuing Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total intangible assets, net	$ 0	0
Total goodwill	0	0
Assets from continuing operations	58,483,000	61,350,000
Notes payable, non-recourse	23,416,000	27,638,000
Current portion of notes payable	0	0
Capital leases	0	0
Services | Segment, Continuing Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total intangible assets, net	0	0
Total goodwill	0	0
Assets from continuing operations	1,597,000	1,084,000
Notes payable, non-recourse	0	0
Current portion of notes payable	0	0
Capital leases	0	0
Content and Entertainment Segment [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total goodwill	8,701,000	26,701,000
Content and Entertainment Segment [Member] | Segment, Continuing Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total intangible assets, net	28,620,000	31,520,000
Total goodwill	8,701,000	26,701,000
Assets from continuing operations	99,916,000	122,610,000
Notes payable, non-recourse	0	0
Current portion of notes payable	0	0
Capital leases	86,000	84,000
Corporate | Segment, Continuing Operations [Member]
Segment Reporting, Asset Reconciling Item [Line Items]
Total intangible assets, net	12,000	12,000
Total goodwill	0	0
Assets from continuing operations	18,228,000	13,378,000
Notes payable, non-recourse	0	0
Current portion of notes payable	79,667,000	45,294,000
Capital leases	$ 5,107,000	$ 5,411,000

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

6 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION AND CONSOLIDATION

We have incurred net losses historically and have an accumulated deficit of $333.7 million as of September 30, 2015. We also have significant contractual obligations related to our recourse and non-recourse debt for the remainder of the fiscal year ending March 31, 2016 and beyond. We may continue to generate net losses for the foreseeable future. We believe the combination of: (i) our cash and restricted cash balances at September 30, 2015, (ii) the remaining availability under our revolving line of credit, (iii) planned cost reduction initiatives, and (iv) expected cash flows from operations will be sufficient to satisfy our liquidity and capital requirements for the next twelve months. Our capital requirements will depend on many factors, and we may need to use available capital resources and raise additional capital. As a result of our ongoing process of exploring and evaluating potential significant strategic and capital raising opportunities with the help of our financial advisor, we are in discussions with a potential investor to help meet our ongoing capital raising requirements. There can be no assurance that the transaction under discussion will be consummated. Failure to generate additional revenues, raise additional capital or manage discretionary spending could have an adverse effect on our financial position, results of operations or liquidity.

The accompanying Condensed Consolidated Financial Statements are unaudited and include the accounts of the Company, its wholly owned subsidiaries and subsidiaries in which it has a controlling interest, and reflect all normal and recurring adjustments necessary for the fair presentation of its financial position, results of operations and cash flows. All material inter-company accounts and transactions have been eliminated in consolidation.

We have reclassified certain amounts previously reported in our financial statements to conform to the current presentation. Effective September 30, 2015, we elected to change our method of presentation relating to debt issuance costs in accordance with Financial Accounting Standards Board ("FASB") ASU 2015-03 - Simplifying the Presentation of Debt Issuance Costs.  Prior to September 30, 2015, our policy was to present debt issuance costs in Other Assets on the Condensed Consolidated Balance Sheets, net of accumulated amortization. Beginning with the period ended September 30, 2015, we have presented these costs as a direct deduction to notes payable. Unamortized debt issuance costs of $6.7 million previously reported as assets on our Consolidated Balance Sheet as of March 31, 2015 have been reclassified as a direct deduction to notes payable.

USE OF ESTIMATES

The preparation of these Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires us to make estimates and assumptions that affect the amounts reported in these Condensed Consolidated Financial Statements and accompanying notes. As permitted under GAAP, interim accounting for certain expenses, such as the adequacy of accounts receivable reserves, return reserves, inventory reserves, recoupment of advances, minimum guarantees, assessment of goodwill and intangible asset impairment and valuation reserve for income taxes, are based on full year assumptions when appropriate. Actual results could differ materially from those estimates.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"), although we believe that the disclosures are adequate to make the information presented not misleading. The results of operations for the respective interim periods are not necessarily indicative of the results expected for the full year. These Condensed Consolidated Financial Statements and accompanying notes should be read in conjunction with our annual consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2015.

CASH AND CASH EQUIVALENTS

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. We maintain bank accounts with major banks, which from time to time may exceed the Federal Deposit Insurance Corporation’s insured limits. We periodically assess the financial condition of the institutions and believe that the risk of any loss is minimal.

ACCOUNTS RECEIVABLE

We maintain reserves for potential credit losses on accounts receivable. We review the composition of accounts receivable and analyze historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.

Our Content & Entertainment segment recognizes accounts receivable, net of an estimated allowance for product returns and customer chargebacks, at the time that it recognizes revenue from a sale. We base the amount of the returns allowance and customer chargebacks upon historical experience and future expectations.

We record accounts receivable, long-term in connection with activation fees that we earn from Systems deployments that have extended payment terms. Such accounts receivable are discounted to their present value at prevailing market rates and are recorded as other assets in the Condensed Consolidated Balance Sheets.

ADVANCES

Advances are recorded within prepaid and other current assets within the Condensed Consolidated Balance Sheets and represent amounts prepaid to studios or content producers for which we provide content distribution services. We evaluate advances regularly for recoverability and record charges for amounts that we expect may not be recoverable as of the balance sheet date.

INVENTORY

Inventory consists of finished goods of Company owned, physical DVD and Blu-ray Disc titles and is stated at the lower of cost (determined based on weighted average cost) or market. We identify inventory items to be written down for obsolescence based on their sales status and condition. We write down discontinued or slow moving inventories based on an estimate of the markdown to retail price needed to sell through our current stock level of the inventories.

RESTRICTED CASH

Our 2013 Term Loans, Prospect Loan and Cinedigm Credit Agreement require that we maintain specified cash balances that are restricted to repayment of interest (see Note 5 - Notes Payable).

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation expense is recorded using the straight-line method over the estimated useful lives of the respective assets as follows:

Computer equipment and software	3 - 5 years
Digital cinema projection systems	10 years
Machinery and equipment	3 - 10 years
Furniture and fixtures	3 - 6 years

Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the leasehold improvements. Repair and maintenance costs are charged to expense as incurred. Major renewals, improvements and additions are capitalized. Upon the sale or other disposition of any property and equipment, the cost and related accumulated depreciation and amortization are removed from the accounts and the gain or loss on disposal is included in the Condensed Consolidated Statements of Operations.

ACCOUNTING FOR DERIVATIVE ACTIVITIES

Derivative financial instruments are recorded at fair value. Changes in the fair value of derivative financial instruments are either recognized in accumulated other comprehensive loss (a component of stockholders' deficit) or in the Condensed Consolidated Statements of Operations depending on whether the derivative qualifies for hedge accounting. We have entered into two separate interest rate cap transactions to limit our exposure to interest rates related to our 2013 Term Loans and Prospect Loan. The interest rate caps on the 2013 Term Loans and Prospect Loan mature in March of 2016 and 2018, respectively. We have not sought hedge accounting treatment for these instruments and therefore, changes in the value of our interest rate derivatives were recorded in the Condensed Consolidated Statements of Operations.

FAIR VALUE MEASUREMENTS

The fair value measurement disclosures are grouped into three levels based on valuation factors:

• Level 1 – quoted prices in active markets for identical investments

• Level 2 – other significant observable inputs (including quoted prices for similar investments and market corroborated inputs)

• Level 3 – significant unobservable inputs (including our own assumptions in determining the fair value of investments)

Assets and liabilities measured at fair value on a recurring basis use the market approach, where prices and other relevant information are generated by market transactions involving identical or comparable assets or liabilities.

The following tables summarize the levels of fair value measurements of our financial assets and liabilities:

	As of September 30, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	8,983	$	—	$	—	$	8,983
Interest rate derivatives	—		172		—		172
	$	8,983	$	172	$	—	$	9,155

	As of March 31, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	6,751	$	—	$	—	$	6,751
Interest rate derivatives	—		208		—		208
	$	6,751	$	208	$	—	$	6,959

Our cash and cash equivalents, accounts receivable, unbilled revenue and accounts payable and accrued expenses are financial instruments and are recorded at cost in the Condensed Consolidated Balance Sheets. The estimated fair values of these financial instruments approximate their carrying amounts because of their short-term nature.  The carrying amount of accounts receivable, long-term and notes receivable approximates fair value based on the discounted cash flows of such instruments using current assumptions at the balance sheet date. At September 30, 2015 and March 31, 2015, the estimated fair value of our fixed rate debt approximated its carrying amounts. We estimated the fair value of debt based upon current interest rates available to us at the respective balance sheet dates for arrangements with similar terms and conditions. Based on borrowing rates currently available to us for loans with similar terms, the carrying value of notes payable and capital lease obligations approximates fair value.

IMPAIRMENT OF LONG-LIVED AND FINITE-LIVED ASSETS

We review the recoverability of our long-lived assets and finite-lived intangible assets, when events or conditions occur that indicate a possible impairment exists. The assessment for recoverability is based primarily on our ability to recover the carrying value of our long-lived and finite-lived assets from expected future undiscounted net cash flows. If the total of expected future undiscounted net cash flows is less than the total carrying value of the asset, the asset is deemed not to be recoverable and possibly impaired. We then estimate the fair value of the asset to determine whether an impairment loss should be recognized. An impairment loss will be recognized if the asset's fair value is determined to be less than its carrying value. Fair value is determined by computing the expected future discounted cash flows. During the six monthsended September 30, 2015 and 2014, no impairment charge was recorded from continuing operations for long-lived assets or finite-lived assets.

GOODWILL

Goodwill is the excess of the purchase price paid over the fair value of the net assets of an acquired business. Goodwill is tested for impairment on an annual basis at the end of the fourth quarter of each fiscal year, or more often if warranted by events or changes in circumstances indicating that the carrying value of a reporting unit may exceed fair value, also known as impairment indicators. Our process of evaluating goodwill for impairment involves the determination of fair value of goodwill compared to its carrying value. Our only reporting unit with goodwill is our Content & Entertainment reporting unit, which had a goodwill carrying value that was materially derived from our October 2013 acquisition of a division of Gaiam, Inc. and Gaiam Americas, Inc. (the "GVE acquisition").

Inherent in the fair value determination for each reporting unit are certain judgments and estimates relating to future cash flows, including management’s interpretation of current economic indicators and market conditions, and assumptions about our strategic plans with regard to its operations. To the extent additional information arises, market conditions change or our strategies change, it is possible that the conclusion regarding whether our remaining goodwill is impaired could change and result in future goodwill impairment charges that will have a material effect on our consolidated financial position or results of operations.

As a result of factors discussed in detail below, we performed a quantitative fair value assessment for our CEG reporting unit as of September 30, 2015, and determined that the reporting unit had a fair value less than its carrying amount. As a result, we recorded a goodwill impairment charge of $18.0 million for the three months and six months ended September 30, 2015. In determining fair value we used various assumptions, including expectations of future cash flows based on projections or forecasts derived from analysis of business prospects, economic or market trends and any regulatory changes that may occur. We estimated the fair value of the reporting unit using a net present value methodology, which is dependent on significant assumptions related to estimated future discounted cash flows, discount rates and tax rates. The assumptions used in our goodwill impairment tests should not be construed as earnings guidance or long-term projections. Our cash flow assumptions are based on a 5-year internal projection of adjusted EBITDA for the Content & Entertainment reporting unit. We assumed a market-based weighted average cost of capital of 17% to discount cash flows for our CEG segment and used a blended federal and state tax rate of 40%.

We reassessed the fair value of our CEG reporting unit in the second quarter of 2015 because the reporting unit is expected to perform below the fiscal year 2016 forecast that we had established during our annual testing of goodwill at March 31, 2015. The Company faced challenges in the first half of fiscal 2016 that significantly impacted our ability to establish the new contracts, customer relationships and OTT channels that we had originally anticipated and shifted a portion of management's focus away from business operations. As a result, our fiscal 2016 projections for revenue and adjusted EBITDA are expected to fall materially below our original estimates, particularly those for the second half of the fiscal year. Future decreases in the fair value of our CEG reporting unit may require us to record additional goodwill impairment, particularly if our expectations of future cash flows are not achieved.

Information related to the goodwill allocated to our Content & Entertainment segment is as follows:

(In thousands)	Goodwill
As of March 31, 2015	$	26,701
Goodwill impairment	(18,000		)
As of September 30, 2015	$	8,701

Gross amounts of goodwill and accumulated impairment charges that we have recorded are as follows:

(In thousands)	Goodwill
Goodwill	$	32,701
Accumulated impairment losses	(24,000		)
Net goodwill at September 30, 2015	$	8,701

No goodwill impairment charge was recorded in the six months ended September 30, 2014.

PARTICIPATIONS AND ROYALTIES PAYABLE

We record liabilities within accounts payable and accrued expenses on the Condensed Consolidated Balance Sheet, that represent amounts owed to studios or content producers for royalties owed under licensing arrangements when we provide content distribution services. We identify and record as a reduction to the liability any expenses that are to be reimbursed to us by such studios or content producers.

DEBT ISSUANCE COSTS

We incur debt issuance costs in connection with long-term debt financings. Such costs are recorded as a direct deduction to notes payable and amortized over the terms of the respective debt obligations using the effective interest rate method (see Note 5 - Notes Payable). Debt issuance costs recorded in connection with revolving debt arrangements are presented in other assets on the Condensed Consolidated Balance Sheets and are amortized over the term of the revolving debt agreements using the effective interest rate method.

REVENUE RECOGNITION

Phase I Deployment and Phase II Deployment

Virtual print fees (“VPFs”) are earned, net of administrative fees, pursuant to contracts with movie studios and distributors, whereby amounts are payable by a studio to Phase 1 DC and to Phase 2 DC when movies distributed by the studio are displayed on screens utilizing our Systems installed in movie theatres. VPFs are earned and payable to Phase 1 DC based on a defined fee schedule with a reduced VPF rate year over year until the sixth year at which point the VPF rate remains unchanged through the tenth year, at which point the VPFs phase out.  One VPF is payable for every digital title displayed per System. The amount of VPF revenue is dependent on the number of movie titles released and displayed using the Systems in any given accounting period. VPF revenue is recognized in the period in which the digital title first plays on a System for general audience viewing in a digitally-equipped movie theatre, as Phase 1 DC’s and Phase 2 DC’s performance obligations have been substantially met at that time. Beginning in December 2015, certain Phase 1 DC Systems will have reached the conclusion of their deployment payment period. In accordance with existing agreements with distributors, a substantial portion of VPF revenues will cease to be recognized on such Systems. Because the Phase I deployment installation period ended in November 2007, a majority of the VPF revenue associated with the Phase I systems will end by November 2017. While the absence of such revenue is not expected to be material to the Condensed Consolidated Statements of Operations during the fiscal year ending March 31, 2016, it is expected to have a material cumulative impact in subsequent periods.

Phase 2 DC’s agreements with distributors require the payment of VPFs, according to a defined fee schedule, for ten years from the date each system is installed; however, Phase 2 DC may no longer collect VPFs once “cost recoupment,” as defined in the agreements, is achieved.  Cost recoupment will occur once the cumulative VPFs and other cash receipts collected by Phase 2 DC have equaled the total of all cash outflows, including the purchase price of all Systems, all financing costs, all “overhead and ongoing costs”, as defined, and including service fees, subject to maximum agreed upon amounts during the three-year rollout period and thereafter.  Further, if cost recoupment occurs before the end of the eighth contract year, the studio will pay us a one-time “cost recoupment bonus”. Any other cash flows, net of expenses, received by Phase 2 DC following the achievement of cost recoupment are required to be returned to the distributors on a pro-rata basis. At this time, the Company cannot estimate the timing or probability of the achievement of cost recoupment. Beginning in December 2018, certain Phase 2 DC Systems will have reached the conclusion of their deployment payment period, subject to earlier achievement of cost recoupment. In accordance with existing agreements with distributors, VPF revenues will cease to be recognized on such Systems. Because the Phase II deployment installation period ended in December 2012, a majority of the VPF revenue associated with the Phase I systems will end by December 2022 or earlier if cost recoupment is achieved.

Alternative content fees (“ACFs”) are earned pursuant to contracts with movie exhibitors, whereby amounts are payable to Phase 1 DC and to Phase 2 DC, generally either a fixed amount or as a percentage of the applicable box office revenue derived from the exhibitor’s showing of content other than feature movies, such as concerts and sporting events (typically referred to as “alternative content”). ACF revenue is recognized in the period in which the alternative content first opens for audience viewing.

Revenues earned in connection with up front exhibitor contributions are deferred and recognized over the expected cost recoupment period.

Services

Exhibitors who purchased and own Systems using their own financing in the Phase II Deployment paid us an upfront activation fee that is generally $2.0 thousand per screen (the “Exhibitor-Buyer Structure”). These upfront activation fees are recognized in the period in which these Systems were delivered and are ready for content, as we had no further obligations to the customer after that time and collection was reasonably assured. In addition, we recognize activation fee revenue of between $1.0 thousand and $2.0 thousand on Phase 2 DC Systems and for Systems installed by CDF2 Holdings (See Note 4 - Other Interests) upon installation and such fees are generally collected upfront upon installation. Our services segment manages and collects VPFs on behalf of exhibitors, for which it earns an administrative fee equal to 10% of the VPFs collected.

Our Services segment earns an administrative fee of approximately 5% of VPFs collected and, in addition, earns an incentive service fee equal to 2.5% of the VPFs earned by Phase 1 DC. This administrative fee is recognized in the period in which the billing of VPFs occurs, as performance obligations have been substantially met at that time.

Content & Entertainment

CEG earns fees for the distribution of content in the home entertainment markets via several distribution channels, including digital, VOD, and physical goods (e.g., DVD and Blu-ray Discs). Fees earned are typically based on the gross amounts billed to our customers less the amounts owed to the media studios or content producers under distribution agreements, and gross media sales of owned or licensed content. Depending upon the nature of the agreements with the platform and content providers, the fee rate that we earn varies. Generally, revenues are recognized when content is available for subscription on the digital platform, at the time of shipment for physical goods, or point-of-sale for transactional and VOD services. Reserves for sales returns and other allowances are recorded based upon historical experience. If actual future returns and allowances differ from past experience, adjustments to our allowances may be required. Sales returns and allowances are reported as a reduction of revenues.

CEG also has contracts for the theatrical distribution of third party feature movies and alternative content. CEG’s distribution fee revenue and CEG's participation in box office receipts is recognized at the time a feature movie and alternative content are viewed. CEG has the right to receive or bill a portion of the theatrical distribution fee in advance of the exhibition date, and therefore such amount is recorded as a receivable at the time of execution, and all related distribution revenue is deferred until the theatrical release date of the third party feature movie or alternative content.

DIRECT OPERATING COSTS

Direct operating costs primarily consist of operating costs such as cost of goods sold, fulfillment expenses, shipping costs, royalty expenses, participation expenses, marketing and direct personnel costs.

STOCK-BASED COMPENSATION

Employee and director stock-based compensation expense from continuing operations related to our stock-based awards was as follows:

	For the Three Months Ended September 30,				For the Six Months Ended September 30,
(In thousands)	2015		2014		2015		2014
Direct operating	$	4	$	3	$	10	$	6
Selling, general and administrative	397		404		1,063		1,019
	$	401	$	407	$	1,073	$	1,025

The weighted-average grant-date fair value of options granted during the three monthsended September 30, 2015 and 2014 was $0.35 and $1.09, respectively, and $0.52 and $1.27 for the six months ended September 30, 2015 and 2014, respectively. There were zero and 6,673 stock options exercised during the three monthsended September 30, 2015 and September 30, 2014, respectively, and 25,000 and 41,066 stock options exercised for the six months ended September 30, 2015 and 2014, respectively.

We estimated the fair value of stock options at the date of each grant using a Black-Scholes option valuation model with the following assumptions:

	For the Three Months Ended September 30,		For the Six Months Ended September 30,
Assumptions for Option Grants	2015	2014	2015	2014
Range of risk-free interest rates	1.5% - 1.6%	1.6 - 1.8%	1.4% - 1.7%	1.6 - 1.8%
Dividend yield	—	—	—	—
Expected life (years)	5	5	5	5
Range of expected volatilities	70.7 - 70.7%	71.4 - 71.5%	70.6 - 70.9%	71.4 - 72.3%

The risk-free interest rate used in the Black-Scholes option pricing model for options granted under our stock option plan awards is the historical yield on U.S. Treasury securities with equivalent remaining lives. We do not currently anticipate paying any cash dividends on common stock in the foreseeable future. Consequently, an expected dividend yield of zero is used in the Black-Scholes option pricing model.  We estimate the expected life of options granted under our stock option plans using both exercise behavior and post-vesting termination behavior, as well as consideration of outstanding options. We estimate expected volatility for options granted under our stock option plans based on a measure of our Class A common stock's historical volatility in the trading market.

NET LOSS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS

Basic and diluted net loss per common share has been calculated as follows:

Basic and diluted net loss per common share attributable to common stockholders =	Net loss attributable to common stockholders
	Weighted average number of common stock  outstanding during the period

Stock issued and treasury stock repurchased during the period are weighted for the portion of the period that they are outstanding. The shares to be repurchased in connection with the forward stock purchase transaction discussed in Note 6 - Stockholders' Deficit are considered repurchased for the purposes of calculating earnings per share and therefore the calculation of weighted average shares outstanding as of September 30, 2015 excludes approximately 11.8 million shares that will be repurchased as a result of the forward stock purchase transaction.

Loss per share from continuing operations is calculated similarly to basic and diluted loss per common share attributable to common shareholders, except that it uses loss from continuing operations in the numerator and takes into account the net loss attributable to noncontrolling interest.

We incurred net losses for each of the three months and six monthsended September 30, 2015 and 2014, and therefore the impact of potentially dilutive common shares from outstanding stock options and warrants, totaling 29,135,181 shares and 29,113,797 shares as of September 30, 2015 and 2014, respectively, were excluded from the computation of earnings per share as their impact would have been anti-dilutive.

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the FASB issued new accounting guidance on revenue recognition. The new standard provides for a single five-step model to be applied to all revenue contracts with customers as well as requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. Companies have an option to use either a retrospective approach or cumulative effect adjustment approach to implement the standard. The guidance will be effective during our fiscal year ending March 31, 2019 with early adoption permitted. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In June 2014, the FASB issued an accounting standards update, which provides additional guidance on how to account for share-based payments where the terms of an award may provide that the performance target could be achieved after an employee completes the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite period is treated as a performance condition. The guidance will be effective during our fiscal year ending March 31, 2017. We are currently evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements. The standards update may be applied (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In August 2014, the FASB amended accounting guidance pertaining to going concern considerations by company management. The amendments in this update state that in connection with preparing financial statements for each annual and interim reporting period, an entity's management should evaluate whether there are conditions or events that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued, when applicable). The guidance will be effective during our fiscal year ending March 31, 2018. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In February 2015, the FASB issued an accounting standards update, which amended accounting guidance on consolidation. The amendments affect reporting entities that are required to evaluate whether they should consolidate certain legal entities. All legal entities are subject to reevaluation under the revised consolidation model. The update will be effective during our fiscal year ending March 31, 2017. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In April 2015, the FASB issued new guidance related to the customer’s accounting for fees paid in a cloud computing arrangement, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2015. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In July 2015, the FASB issued an accounting standards update that requires an entity to measure inventory balances at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In September 2015, the FASB issued new guidance with respect to Business Combinations. The new guidance requires the acquirer in a Business Combination to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The new guidance is effective for public entities for which fiscal years begin after December 15, 2016, and interim periods within the fiscal years beginning after December 31, 2017. The accounting standard must be applied prospectively to adjustments to provisional amounts that occur after the effective date, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

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STOCKHOLDERS' EQUITY - OPTIONS GRANTED OUTSIDE CINEDIGM'S EQUITY INCENTIVE PLAN (Details)	1 Months Ended
	Oct. 31, 2013 employee $ / shares shares	Dec. 31, 2010 $ / shares shares	Sep. 30, 2015 shares
Class A common stock | Chief Executive Officer [Member]
Class of Stock [Line Items]
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Lower Range Limit | $ / shares		$ 1.50
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range, Upper Range Limit | $ / shares		$ 5.00
Class A common stock | Chief Executive Officer [Member] | Stock option
Class of Stock [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized		4,500,000
Gaiam Americas, Inc. and Gaiam, Inc. (GVE) [Member]
Class of Stock [Line Items]
Number of Employees Joining Company Following Acquisition | employee	10
Shares under option, granted	620,000
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ / shares	$ 1.75
Share-based Compensation Arrangement by Share-based Payment Award, Options, Nonvested, Number of Shares			348,750
Gaiam Americas, Inc. and Gaiam, Inc. (GVE) [Member] | Stock option
Class of Stock [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights, Percentage	25.00%
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period	4 years
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period	10 years

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - SCHEDULE OF GOODWILL (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Goodwill [Roll Forward]
As of March 31, 2015			$ 26,701
Goodwill impairment	$ (18,000)	$ 0	(18,000)	$ 0
As of September 30, 2015	8,701		8,701
Content and Entertainment Segment [Member]
Goodwill [Roll Forward]
As of March 31, 2015			26,701
Goodwill impairment	(18,000)		(18,000)
As of September 30, 2015	8,701		8,701
Goodwill	32,701		32,701
Accumulated impairment losses	$ (24,000)		$ (24,000)

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Mar. 31, 2015
Levels of fair value measurements of financial assets:
Restricted cash	$ 8,983	$ 6,751
Fair Value, Measurements, Recurring [Member]
Levels of fair value measurements of financial assets:
Restricted cash	8,983	6,751
Interest rate derivatives	172	208
Financial assets	9,155	6,959
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1
Levels of fair value measurements of financial assets:
Restricted cash	8,983	6,751
Interest rate derivatives	0	0
Financial assets	8,983	6,751
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2
Levels of fair value measurements of financial assets:
Restricted cash	0	0
Interest rate derivatives	172	208
Financial assets	172	208
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3
Levels of fair value measurements of financial assets:
Restricted cash	0	0
Interest rate derivatives	0	0
Financial assets	$ 0	$ 0

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STOCKHOLDERS' EQUITY - WARRANTS (Details) - $ / shares	6 Months Ended
	Sep. 30, 2015	Apr. 29, 2015	Apr. 28, 2015
Sageview Warrants
Class of Warrant or Right [Line Items]
Outstanding warrants	16,732,824
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 1.31	$ 1.31	$ 1.37
Class of Warrant or Right, Number of Securities Called by Warrants or Rights		16,732,824	16,000,000
Strategic Management Service Provider Warrants
Class of Warrant or Right [Line Items]
Outstanding warrants	525,000
Class of Warrant or Right, Termination Notice	90 days
Warrants issued to creditors in connection with the 2013 Notes
Class of Warrant or Right [Line Items]
Outstanding warrants	1,250,625
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 1.85
Minimum [Member] | Strategic Management Service Provider Warrants
Class of Warrant or Right [Line Items]
Class of Warrant or Right, Exercise Price of Warrants or Rights	1.72
Maximum [Member] | Strategic Management Service Provider Warrants
Class of Warrant or Right [Line Items]
Class of Warrant or Right, Exercise Price of Warrants or Rights	$ 3.00

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - EMPLOYEE STOCK-BASED COMPENSATION EXPENSE (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value	$ 0.35	$ 1.09	$ 0.52	$ 1.27
Total stock-based compensation	$ 401	$ 407	$ 1,073	$ 1,025
Direct operating
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	4	3	10	6
Selling, general and administrative
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Total stock-based compensation	$ 397	$ 404	$ 1,063	$ 1,019

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - FAIR VALUE ASSUMPTIONS USED FOR STOCK OPTIONS (Details)	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Assumptions for Option Grants:
Dividend yield	0.00%	0.00%	0.00%	0.00%
Expected life (years)	5 years	5 years	5 years	5 years
Range of expected volatilities, minimum	70.70%	71.40%	70.60%	71.40%
Range of expected volatilities, maximum	70.70%	71.50%	70.90%	72.30%
Minimum [Member]
Assumptions for Option Grants:
Range of risk free rates	1.50%	1.60%	1.40%	1.60%
Maximum [Member]
Assumptions for Option Grants:
Range of risk free rates	1.60%	1.80%	1.70%	1.80%

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NATURE OF OPERATIONS

6 Months Ended

Sep. 30, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NATURE OF OPERATIONS

NATURE OF OPERATIONS

Cinedigm Corp. was incorporated in Delaware on March 31, 2000 (“Cinedigm”, and collectively with its subsidiaries, the “Company,” "we," "us," or similar pronouns). We are (i) a leading distributor and aggregator of independent movie, television and other short form content, managing a distribution rights library of close to 50,000 titles and episodes released across digital, physical, theatrical, home and mobile entertainment platforms and (ii) a leading servicer of digital cinema assets on more than 12,000 movie screens in both North America, Australia and New Zealand.

We report our financial results in the following reportable segments: (1) the first digital cinema deployment (“Phase I Deployment”), (2) the second digital cinema deployment (“Phase II Deployment”), (3) digital cinema services (“Services”) and (4) media content and entertainment group (“Content & Entertainment” or "CEG"). The Phase I Deployment and Phase II Deployment segments are the financing vehicles and administrators for our digital cinema equipment (the “Systems”) installed in movie theatres throughout the United States, and in Australia and New Zealand, which are non-recourse to the other segments of our business. Our Services segment provides fee based support to more than 12,000 movie screens in our Phase I Deployment and Phase II Deployment segments as well as directly to exhibitors and other third party customers in the form of monitoring, billing, collections and verification services. Our Content & Entertainment segment is focused on: (1) ancillary market aggregation and distribution of entertainment content, and (2) branded and curated over-the-top ("OTT") digital network business providing entertainment channels and applications. We are structured so that our digital cinema business (collectively, the Phase I Deployment, Phase II Deployment and Services segments) operates independently from our Content & Entertainment segment.

Investments in which we do not have a controlling interest or are not the primary beneficiary but have the ability to exert significant influence, are accounted for under the equity method of accounting. Noncontrolling interests for which we have been determined to have a controlling financial interest are consolidated and recorded net of tax as net income (loss) attributable to noncontrolling interest. See Note 4 - Other Interests to the Condensed Consolidated Financial Statements for a discussion of our noncontrolling interests.

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DISCONTINUED OPERATIONS (Details) - USD ($) $ in Thousands		3 Months Ended		6 Months Ended
	Sep. 23, 2014	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Discontinued Operations and Disposal Groups [Abstract]
Loss on sale of discontinued operations	$ 3,045	$ 0	$ 3,045	$ 0	$ 3,045
Revenues			919		1,968
Costs and Expenses:
Direct operating			151		326
Selling, general and administrative			561		1,093
Research and development			5		14
Total operating expenses			717		1,433
Income from operations			202		535
Other expense, net			(8)		(93)
Income before provision for income taxes			194		442
Provision for income taxes			99		0
Income from discontinued operations, net of taxes		$ 0	$ 293	$ 0	$ 442

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STOCKHOLDERS' EQUITY - PREFERRED STOCK (Details) - USD ($) $ in Thousands	1 Months Ended	6 Months Ended	12 Months Ended
	Oct. 31, 2015	Sep. 30, 2015	Mar. 31, 2015
Class of Stock [Line Items]
Dividends, Preferred Stock		$ 89	$ 89
Subsequent Event [Member] | Class A common stock
Class of Stock [Line Items]
Preferred stock dividends (shares)	114,644

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Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2015	Mar. 31, 2015
Current assets
Cash and cash equivalents	$ 18,963	$ 18,999
Accounts receivable, net of allowance for doubtful accounts of $936 and $597, respectively	64,867	59,591
Inventory	2,938	3,210
Unbilled revenue	4,096	5,065
Prepaid and other current assets	18,714	20,078
Total current assets	109,578	106,943
Restricted cash	8,983	6,751
Property and equipment, net	80,826	98,561
Intangible assets, net	28,865	31,784
Goodwill	8,701	26,701
Other assets	1,953	2,277
Total assets	238,906	273,017
Current liabilities
Accounts payable and accrued expenses	75,817	77,147
Current portion of notes payable, non-recourse	30,840	32,973
Current portion of notes payable	0	24,294
Current portion of capital leases	673	640
Current portion of deferred revenue	2,629	2,760
Total current liabilities	109,959	137,814
Notes payable, non-recourse, net of current portion	101,555	118,387
Notes payable, net of current portion	79,667	21,000
Capital leases, net of current portion	4,520	4,855
Deferred revenue, net of current portion	9,274	10,098
Total liabilities	304,975	292,154
Stockholders’ deficit
Additional paid-in capital	267,660	277,984
Treasury stock, at cost	(2,839)	(172)
Accumulated deficit	(333,746)	(300,350)
Accumulated other comprehensive loss	(27)	(57)
Total stockholders’ deficit of Cinedigm Corp.	(65,315)	(18,959)
Deficit attributable to noncontrolling interest	(754)	(178)
Total deficit	(66,069)	(19,137)
Total liabilities and deficit	238,906	273,017
Series A preferred stock
Stockholders’ deficit
Preferred stock	3,559	3,559
Class A common stock
Stockholders’ deficit
Common stock	$ 78	$ 77

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COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Thousands	1 Months Ended	3 Months Ended	6 Months Ended
	Jan. 31, 2015	Sep. 30, 2015	Sep. 30, 2015
Loss Contingencies [Line Items]
Litigation settlement recovery, net of expenses		$ (1,208)	$ (410)
Gaiam Litigation [Member]
Loss Contingencies [Line Items]
Litigation Settlement, Mediation Period	2 days
Litigation settlement recovery, net of expenses			$ 2,300
Litigation Settlement, Arbitration Period			90 days

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Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Cash flows from operating activities:
Net loss	$ (34,393)	$ (18,007)
Adjustments to reconcile net loss to net cash provided by operating activities:
Loss on disposal of business	0	3,045
Depreciation and amortization of property and equipment and amortization of intangible assets	21,706	22,116
Goodwill impairment	18,000	0
Amortization of debt issuance costs included in interest expense	1,203	886
Provision for doubtful accounts	339	172
Provision for inventory reserve	500	900
Stock-based compensation and expenses	1,073	1,073
Change in fair value of interest rate derivatives	66	175
Accretion and PIK interest expense added to note payable	1,124	1,222
Loss on extinguishment of debt	931	0
Changes in operating assets and liabilities, net of acquisitions and dispositions:
Accounts receivable	(5,562)	(17,743)
Inventory	(228)	(921)
Unbilled revenue	969	2,072
Prepaid expenses and other assets	1,287	(8,853)
Accounts payable, accrued expenses and other liabilities	(1,434)	17,667
Deferred revenue	(955)	(1,257)
Net cash provided by operating activities	4,626	2,547
Cash flows from investing activities:
Contributions from noncontrolling interest	599	0
Purchases of property and equipment	(1,049)	(620)
Purchases of intangible assets	(3)	(6)
Restricted cash	(2,232)	0
Proceeds from sale of business	0	2,950
Additions to capitalized software costs	0	(855)
Net cash (used in) provided by investing activities	(453)	1,469
Cash flows from financing activities:
Payment of notes payable	(38,820)	(29,115)
Payment for structured stock repurchase forward contract	(11,440)	0
Principal payments on capital leases	(302)	(298)
Payments of debt issuance costs	(3,581)	0
Costs associated with issuance of Class A common stock	0	(72)
Net cash used in financing activities	(4,209)	(24,485)
Net change in cash and cash equivalents	(36)	(20,469)
Cash and cash equivalents at beginning of period	18,999	50,215
Cash and cash equivalents at end of period	18,963	29,746
Class A common stock
Cash flows from financing activities:
Repurchase of Class A common stock	(2,667)	0
Revolving Credit Agreement
Cash flows from financing activities:
Net (repayments) borrowings under revolving credit agreement	(9,167)	5,000
5.5% Convertible Notes | Convertible Debt [Member]
Cash flows from financing activities:
Proceeds from issuance of 5.5% Convertible Notes	$ 64,000	$ 0

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NOTES PAYABLE - NARRATIVE (Details)					1 Months Ended		3 Months Ended		6 Months Ended
	Apr. 29, 2015 USD ($) $ / shares shares	Oct. 17, 2013 USD ($)	Feb. 28, 2013 USD ($)	Feb. 28, 2013 USD ($)	Apr. 30, 2015 USD ($)	Oct. 31, 2013 USD ($) shares	Sep. 30, 2015 USD ($) installments	Sep. 30, 2014 USD ($)	Sep. 30, 2015 USD ($) installments	Sep. 30, 2014 USD ($)	Mar. 31, 2015 USD ($)
Line of Credit Facility [Line Items]
Restricted cash							$ 8,983,000		$ 8,983,000		$ 6,751,000
Payments of Debt Issuance Costs									3,581,000	$ 0
Gains (Losses) on Extinguishment of Debt							0	$ 0	(931,000)	$ 0
Long Term Portion							181,222,000		181,222,000		139,387,000
Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity							$ 53,523,000		$ 53,523,000
Line of Credit Facility, Principal Payment, Number of Quarterly Installments | installments							28		28
Recourse Notes Payable [Member]
Line of Credit Facility [Line Items]
Long Term Portion							$ 79,667,000		$ 79,667,000		21,000,000
Debt Service Payment for 2013 and 2010 Credit Agreements
Line of Credit Facility [Line Items]
Restricted Cash Debt Servicing							3,800,000		3,800,000		3,900,000
2013 Prospect Term Loan Agreement
Line of Credit Facility [Line Items]
Restricted Cash Debt Servicing							1,900,000		1,900,000		6,500,000
Restricted cash							1,000,000		1,000,000		1,000,000
2013 Term Loans [Member]
Line of Credit Facility [Line Items]
Restricted cash							5,800,000		$ 5,800,000		5,800,000
LIBOR
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate									0.33%
Eurodollar [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate		1.00%
Federal Funds Effective Swap Rate [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate		0.50%
2013 Prospect Term Loan Agreement
Line of Credit Facility [Line Items]
Debt Instrument, Face Amount			$ 70,000,000	$ 70,000,000			70,000,000		$ 70,000,000		70,000,000
Debt Instrument, Basis Spread on Variable Rate			9.00%
Debt Instrument, Interest Rate, Stated Percentage			2.50%	2.50%
Guarantor Obligations, Maximum Exposure, Annual Limit									1,500,000
Long Term Portion							67,204,000		67,204,000		67,967,000
2013 Prospect Term Loan Agreement | Debt Instrument, Prepayment Period - Between Second And Third Anniversary
Line of Credit Facility [Line Items]
Debt Instrument, Prepayment Premium			5.00%	5.00%
2013 Prospect Term Loan Agreement | Debt Instrument, Prepayment Period - Between Third and Fourth Anniversary
Line of Credit Facility [Line Items]
Debt Instrument, Prepayment Premium			4.00%	4.00%
2013 Prospect Term Loan Agreement | Debt Instrument, Prepayment Period - Between Fourth and Fifth Anniversary
Line of Credit Facility [Line Items]
Debt Instrument, Prepayment Premium			3.00%	3.00%
2013 Prospect Term Loan Agreement | Debt Instrument, Prepayment Period - Between Fifth and Sixth Anniversary
Line of Credit Facility [Line Items]
Debt Instrument, Prepayment Premium			2.00%	2.00%
2013 Prospect Term Loan Agreement | Debt Instrument, Prepayment Period - Between Sixth and Seventh Anniversary
Line of Credit Facility [Line Items]
Debt Instrument, Prepayment Premium			1.00%	1.00%
2013 Prospect Term Loan Agreement | LIBOR
Line of Credit Facility [Line Items]
Debt Instrument, Variable Rate Basis, Floor			2.00%	2.00%
Convertible Notes [Member] | Convertible Debt [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Face Amount	$ 64,000,000
Debt Instrument, Interest Rate, Stated Percentage	5.50%
Debt Instrument, Convertible, Conversion Ratio, Denominator	$ 1,000
Debt Instrument, Convertible, Conversion Ratio	0.8245723
Debt Instrument, Convertible, Conversion Price | $ / shares	$ 1.21
Debt Instrument, Convertible, Repurchase Price, Percentage	100.00%
Debt Instrument, Redemption Price, Percentage	100.00%
Proceeds from Issuance of Unsecured Debt	$ 60,900,000
Treasury Stock, Shares, Acquired | shares	2,721,000
Treasury Stock, Value, Acquired, Cost Method	$ 2,700,000
Interest Expense, Debt							900,000		1,500,000
2013 Term Loans
Line of Credit Facility [Line Items]
Debt Instrument, Face Amount			$ 130,000,000	$ 130,000,000			125,087,000		125,087,000		125,087,000
Debt Instrument, Decrease, Assigned			$ 5,000,000	$ 5,000,000
Long Term Portion							23,471,000		23,471,000		36,418,000
Debt Instrument, Unamortized Discount							$ 164,000		$ 164,000		$ 196,000
2013 Term Loans | LIBOR
Line of Credit Facility [Line Items]
Debt Instrument, Variable Rate Basis, Floor			1.00%	1.00%
Debt Instrument, Basis Spread on Variable Rate				2.75%
Debt Instrument, Variable Rate Basis, Percent							0.19%		0.19%
2013 Term Loans | Base Rate [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate				1.75%
Cinedigm Credit Agreement [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity		$ 55,000,000
Cinedigm Credit Agreement [Member] | Line of Credit [Member]
Line of Credit Facility [Line Items]
Repayments of Debt	18,600,000
Debt Instrument, Repurchased Face Amount	$ 18,200,000
Cinedigm Revolving loans | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity		$ 30,000,000
Cinedigm Revolving loans | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Current Borrowing Capacity							$ 17,500,000		$ 17,500,000
Line of Credit Facility, Minimum Liquidity					$ 5,000,000.0
Cinedigm Revolving loans | LIBOR | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate, Minimum					1.00%
Cinedigm Revolving loans | Base Rate [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate		4.00%			3.00%
Debt Instrument, Basis Spread on Variable Rate, Minimum					1.00%
Cinedigm Revolving loans | Eurodollar [Member] | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate		5.00%			4.00%
Cinedigm Term Loans [Member] | Term Loans [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity		$ 25,000,000
Cinedigm Term Loans [Member] | Base Rate [Member] | Term Loans [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate		5.00%
Cinedigm Term Loans [Member] | Eurodollar [Member] | Term Loans [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate		6.00%
Notes 2013 Due 2018 | Senior Notes [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Interest Rate, Stated Percentage						9.00%
Debt Conversion, Original Debt, Amount						$ 5,000,000
Debt Instrument, Unamortized Discount						$ 1,600,000
2013 Warrants [Member] | Senior Notes [Member] | Class A common stock
Line of Credit Facility [Line Items]
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | shares						1,500,000
Forward Stock Purchase Transaction [Member] | Convertible Notes [Member] | Convertible Debt [Member]
Line of Credit Facility [Line Items]
Treasury Stock, Shares, Acquired | shares	11,791,384
Treasury Stock, Value, Acquired, Cost Method	$ 11,400,000
Debt Service Reserve [Member] | Cinedigm Revolving loans | Revolving Credit Facility [Member]
Line of Credit Facility [Line Items]
Restricted cash							$ 2,200,000		$ 2,200,000

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SUPPLEMENTAL CASH FLOW INFORMATION (Tables)

6 Months Ended

Sep. 30, 2015

Supplemental Cash Flow Elements [Abstract]

Schedule of Supplemental Cash Flows

	For the Six Months Ended September 30,
(in thousands)	2015		2014
Cash interest paid	$	6,571	$	8,474
Accrued dividends on preferred stock	$	89	$	178
Issuance of common stock for payment of preferred stock dividends	$	178	$	178
Deferred consideration recorded in connection with sale of business	$	—	$	1,050

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NOTES PAYABLE - NET OF ORIGINAL ISSUE DISCOUNT (Details) - USD ($)	Sep. 30, 2015	Mar. 31, 2015	Feb. 28, 2013
Debt Instrument [Line Items]
Less current portion	$ (30,840,000)	$ (57,267,000)
Long Term Portion	181,222,000	139,387,000
2013 Term Loans, net of discount
Debt Instrument [Line Items]
Debt amount, at issuance	125,087,000	125,087,000	$ 130,000,000
Debt Instrument, Payments to Date	(78,476,000)	(63,348,000)
Discount on debt instrument	(164,000)	(196,000)
Notes payable, net	46,447,000	61,543,000
Less current portion	(22,976,000)	(25,125,000)
Long Term Portion	23,471,000	36,418,000
2013 Prospect Term Loan Agreement
Debt Instrument [Line Items]
Debt amount, at issuance	70,000,000	70,000,000	$ 70,000,000
PIK Interest Accrued	4,495,000	3,640,000
Debt Instrument, Payments to Date	(7,291,000)	(5,673,000)
Notes payable, net	67,204,000	67,967,000
Less current portion	0	0
Long Term Portion	$ 67,204,000	$ 67,967,000

XML

NATURE OF OPERATIONS - NARRATIVE (Details) titles in Thousands, theatre in Thousands	Sep. 30, 2015 titles theatre
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of Titles and Episodes | titles	50
Number Of Movie Theatres	12

XML

Consolidated Statements of Cash Flows Consolidated Statements of Cash Flows (parenthetical)	Sep. 30, 2015	Sep. 30, 2014
5.5% Convertible Notes | Convertible Debt [Member]
Debt Instrument, Interest Rate, Stated Percentage	5.50%	5.50%

XML

Consolidated Balance Sheets (Parenthetical) - USD ($)	6 Months Ended	12 Months Ended
	Sep. 30, 2015	Mar. 31, 2015
Allowance for doubtful accounts receivable	$ 936,000	$ 597,000
Unamortized debt issuance expense	$ 3,392,000	$ 750,000
Preferred stock, shares authorized (shares)	15,000,000	15,000,000
Secured Debt
Unamortized debt issuance expense	$ 5,164,000	$ 5,938,000
Series A preferred stock
Preferred stock, shares authorized (shares)	20	20
Preferred stock, dividend rate (percentage)	10.00%	10.00%
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares issued (shares)	7	7
Preferred stock, shares outstanding (shares)	7	7
Preferred stock, liquidation preference	$ 3,648	$ 3,648
Class A common stock
Common stock, shares authorized (shares)	210,000,000	210,000,000
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares issued (shares)	77,857,873	77,178,494
Common stock, shares outstanding (shares)	75,085,433	77,075,614
Treasury stock, Class A shares (shares)	2,772,440	51,440
Class B common stock
Common stock, shares authorized (shares)	1,241,000	1,241,000
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares issued (shares)	1,241,000	1,241,000
Common stock, shares outstanding (shares)	0	0

XML

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

6 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

BASIS OF PRESENTATION AND CONSOLIDATION

BASIS OF PRESENTATION AND CONSOLIDATION

We have incurred net losses historically and have an accumulated deficit of $333.7 million as of September 30, 2015. We also have significant contractual obligations related to our recourse and non-recourse debt for the remainder of the fiscal year ending March 31, 2016 and beyond. We may continue to generate net losses for the foreseeable future. We believe the combination of: (i) our cash and restricted cash balances at September 30, 2015, (ii) the remaining availability under our revolving line of credit, (iii) planned cost reduction initiatives, and (iv) expected cash flows from operations will be sufficient to satisfy our liquidity and capital requirements for the next twelve months. Our capital requirements will depend on many factors, and we may need to use available capital resources and raise additional capital. As a result of our ongoing process of exploring and evaluating potential significant strategic and capital raising opportunities with the help of our financial advisor, we are in discussions with a potential investor to help meet our ongoing capital raising requirements. There can be no assurance that the transaction under discussion will be consummated. Failure to generate additional revenues, raise additional capital or manage discretionary spending could have an adverse effect on our financial position, results of operations or liquidity.

The accompanying Condensed Consolidated Financial Statements are unaudited and include the accounts of the Company, its wholly owned subsidiaries and subsidiaries in which it has a controlling interest, and reflect all normal and recurring adjustments necessary for the fair presentation of its financial position, results of operations and cash flows. All material inter-company accounts and transactions have been eliminated in consolidation.

We have reclassified certain amounts previously reported in our financial statements to conform to the current presentation. Effective September 30, 2015, we elected to change our method of presentation relating to debt issuance costs in accordance with Financial Accounting Standards Board ("FASB") ASU 2015-03 - Simplifying the Presentation of Debt Issuance Costs.  Prior to September 30, 2015, our policy was to present debt issuance costs in Other Assets on the Condensed Consolidated Balance Sheets, net of accumulated amortization. Beginning with the period ended September 30, 2015, we have presented these costs as a direct deduction to notes payable.

USE OF ESTIMATES

USE OF ESTIMATES

The preparation of these Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires us to make estimates and assumptions that affect the amounts reported in these Condensed Consolidated Financial Statements and accompanying notes. As permitted under GAAP, interim accounting for certain expenses, such as the adequacy of accounts receivable reserves, return reserves, inventory reserves, recoupment of advances, minimum guarantees, assessment of goodwill and intangible asset impairment and valuation reserve for income taxes, are based on full year assumptions when appropriate. Actual results could differ materially from those estimates.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"), although we believe that the disclosures are adequate to make the information presented not misleading. The results of operations for the respective interim periods are not necessarily indicative of the results expected for the full year. These Condensed Consolidated Financial Statements and accompanying notes should be read in conjunction with our annual consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K for the fiscal year ended March 31, 2015.

CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS

We consider all highly liquid investments with an original maturity of three months or less to be cash equivalents. We maintain bank accounts with major banks, which from time to time may exceed the Federal Deposit Insurance Corporation’s insured limits. We periodically assess the financial condition of the institutions and believe that the risk of any loss is minimal.

ACCOUNTS RECEIVABLE

ACCOUNTS RECEIVABLE

We maintain reserves for potential credit losses on accounts receivable. We review the composition of accounts receivable and analyze historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.

Our Content & Entertainment segment recognizes accounts receivable, net of an estimated allowance for product returns and customer chargebacks, at the time that it recognizes revenue from a sale. We base the amount of the returns allowance and customer chargebacks upon historical experience and future expectations.

We record accounts receivable, long-term in connection with activation fees that we earn from Systems deployments that have extended payment terms. Such accounts receivable are discounted to their present value at prevailing market rates and are recorded as other assets in the Condensed Consolidated Balance Sheets.

ADVANCES

ADVANCES

Advances are recorded within prepaid and other current assets within the Condensed Consolidated Balance Sheets and represent amounts prepaid to studios or content producers for which we provide content distribution services. We evaluate advances regularly for recoverability and record charges for amounts that we expect may not be recoverable as of the balance sheet date.

INVENTORY

INVENTORY

Inventory consists of finished goods of Company owned, physical DVD and Blu-ray Disc titles and is stated at the lower of cost (determined based on weighted average cost) or market. We identify inventory items to be written down for obsolescence based on their sales status and condition. We write down discontinued or slow moving inventories based on an estimate of the markdown to retail price needed to sell through our current stock level of the inventories.

RESTRICTED CASH

RESTRICTED CASH

Our 2013 Term Loans, Prospect Loan and Cinedigm Credit Agreement require that we maintain specified cash balances that are restricted to repayment of interest (see Note 5 - Notes Payable).

PROPERTY AND EQUIPMENT

PROPERTY AND EQUIPMENT

Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation expense is recorded using the straight-line method over the estimated useful lives of the respective assets as follows:

Computer equipment and software	3 - 5 years
Digital cinema projection systems	10 years
Machinery and equipment	3 - 10 years
Furniture and fixtures	3 - 6 years

Leasehold improvements are amortized over the shorter of the lease term or the estimated useful life of the leasehold improvements. Repair and maintenance costs are charged to expense as incurred. Major renewals, improvements and additions are capitalized. Upon the sale or other disposition of any property and equipment, the cost and related accumulated depreciation and amortization are removed from the accounts and the gain or loss on disposal is included in the Condensed Consolidated Statements of Operations.

ACCOUNTING FOR DERIVATIVE ACTIVITIES

ACCOUNTING FOR DERIVATIVE ACTIVITIES

Derivative financial instruments are recorded at fair value. Changes in the fair value of derivative financial instruments are either recognized in accumulated other comprehensive loss (a component of stockholders' deficit) or in the Condensed Consolidated Statements of Operations depending on whether the derivative qualifies for hedge accounting. We have entered into two separate interest rate cap transactions to limit our exposure to interest rates related to our 2013 Term Loans and Prospect Loan. The interest rate caps on the 2013 Term Loans and Prospect Loan mature in March of 2016 and 2018, respectively. We have not sought hedge accounting treatment for these instruments and therefore, changes in the value of our interest rate derivatives were recorded in the Condensed Consolidated Statements of Operations.

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS

The fair value measurement disclosures are grouped into three levels based on valuation factors:

• Level 1 – quoted prices in active markets for identical investments

• Level 2 – other significant observable inputs (including quoted prices for similar investments and market corroborated inputs)

• Level 3 – significant unobservable inputs (including our own assumptions in determining the fair value of investments)

Assets and liabilities measured at fair value on a recurring basis use the market approach, where prices and other relevant information are generated by market transactions involving identical or comparable assets or liabilities.

The following tables summarize the levels of fair value measurements of our financial assets and liabilities:

	As of September 30, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	8,983	$	—	$	—	$	8,983
Interest rate derivatives	—		172		—		172
	$	8,983	$	172	$	—	$	9,155

	As of March 31, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	6,751	$	—	$	—	$	6,751
Interest rate derivatives	—		208		—		208
	$	6,751	$	208	$	—	$	6,959

Our cash and cash equivalents, accounts receivable, unbilled revenue and accounts payable and accrued expenses are financial instruments and are recorded at cost in the Condensed Consolidated Balance Sheets. The estimated fair values of these financial instruments approximate their carrying amounts because of their short-term nature.  The carrying amount of accounts receivable, long-term and notes receivable approximates fair value based on the discounted cash flows of such instruments using current assumptions at the balance sheet date. At September 30, 2015 and March 31, 2015, the estimated fair value of our fixed rate debt approximated its carrying amounts. We estimated the fair value of debt based upon current interest rates available to us at the respective balance sheet dates for arrangements with similar terms and conditions. Based on borrowing rates currently available to us for loans with similar terms, the carrying value of notes payable and capital lease obligations approximates fair value.

IMPAIRMENT OF LONG-LIVED AND FINITE-LIVED ASSETS

IMPAIRMENT OF LONG-LIVED AND FINITE-LIVED ASSETS

We review the recoverability of our long-lived assets and finite-lived intangible assets, when events or conditions occur that indicate a possible impairment exists. The assessment for recoverability is based primarily on our ability to recover the carrying value of our long-lived and finite-lived assets from expected future undiscounted net cash flows. If the total of expected future undiscounted net cash flows is less than the total carrying value of the asset, the asset is deemed not to be recoverable and possibly impaired. We then estimate the fair value of the asset to determine whether an impairment loss should be recognized. An impairment loss will be recognized if the asset's fair value is determined to be less than its carrying value. Fair value is determined by computing the expected future discounted cash flows. During the six monthsended September 30, 2015 and 2014, no impairment charge was recorded from continuing operations for long-lived assets or finite-lived assets.

GOODWILL AND INDEFINITE-LIVED INTANGIBLE ASSETS

GOODWILL

Goodwill is the excess of the purchase price paid over the fair value of the net assets of an acquired business. Goodwill is tested for impairment on an annual basis at the end of the fourth quarter of each fiscal year, or more often if warranted by events or changes in circumstances indicating that the carrying value of a reporting unit may exceed fair value, also known as impairment indicators. Our process of evaluating goodwill for impairment involves the determination of fair value of goodwill compared to its carrying value. Our only reporting unit with goodwill is our Content & Entertainment reporting unit, which had a goodwill carrying value that was materially derived from our October 2013 acquisition of a division of Gaiam, Inc. and Gaiam Americas, Inc. (the "GVE acquisition").

Inherent in the fair value determination for each reporting unit are certain judgments and estimates relating to future cash flows, including management’s interpretation of current economic indicators and market conditions, and assumptions about our strategic plans with regard to its operations. To the extent additional information arises, market conditions change or our strategies change, it is possible that the conclusion regarding whether our remaining goodwill is impaired could change and result in future goodwill impairment charges that will have a material effect on our consolidated financial position or results of operations.

As a result of factors discussed in detail below, we performed a quantitative fair value assessment for our CEG reporting unit as of September 30, 2015, and determined that the reporting unit had a fair value less than its carrying amount. As a result, we recorded a goodwill impairment charge of $18.0 million for the three months and six months ended September 30, 2015. In determining fair value we used various assumptions, including expectations of future cash flows based on projections or forecasts derived from analysis of business prospects, economic or market trends and any regulatory changes that may occur. We estimated the fair value of the reporting unit using a net present value methodology, which is dependent on significant assumptions related to estimated future discounted cash flows, discount rates and tax rates. The assumptions used in our goodwill impairment tests should not be construed as earnings guidance or long-term projections. Our cash flow assumptions are based on a 5-year internal projection of adjusted EBITDA for the Content & Entertainment reporting unit. We assumed a market-based weighted average cost of capital of 17% to discount cash flows for our CEG segment and used a blended federal and state tax rate of 40%.

We reassessed the fair value of our CEG reporting unit in the second quarter of 2015 because the reporting unit is expected to perform below the fiscal year 2016 forecast that we had established during our annual testing of goodwill at March 31, 2015. The Company faced challenges in the first half of fiscal 2016 that significantly impacted our ability to establish the new contracts, customer relationships and OTT channels that we had originally anticipated and shifted a portion of management's focus away from business operations. As a result, our fiscal 2016 projections for revenue and adjusted EBITDA are expected to fall materially below our original estimates, particularly those for the second half of the fiscal year. Future decreases in the fair value of our CEG reporting unit may require us to record additional goodwill impairment, particularly if our expectations of future cash flows are not achieved.

REVENUE RECOGNITION

REVENUE RECOGNITION

Phase I Deployment and Phase II Deployment

Virtual print fees (“VPFs”) are earned, net of administrative fees, pursuant to contracts with movie studios and distributors, whereby amounts are payable by a studio to Phase 1 DC and to Phase 2 DC when movies distributed by the studio are displayed on screens utilizing our Systems installed in movie theatres. VPFs are earned and payable to Phase 1 DC based on a defined fee schedule with a reduced VPF rate year over year until the sixth year at which point the VPF rate remains unchanged through the tenth year, at which point the VPFs phase out.  One VPF is payable for every digital title displayed per System. The amount of VPF revenue is dependent on the number of movie titles released and displayed using the Systems in any given accounting period. VPF revenue is recognized in the period in which the digital title first plays on a System for general audience viewing in a digitally-equipped movie theatre, as Phase 1 DC’s and Phase 2 DC’s performance obligations have been substantially met at that time. Beginning in December 2015, certain Phase 1 DC Systems will have reached the conclusion of their deployment payment period. In accordance with existing agreements with distributors, a substantial portion of VPF revenues will cease to be recognized on such Systems. Because the Phase I deployment installation period ended in November 2007, a majority of the VPF revenue associated with the Phase I systems will end by November 2017. While the absence of such revenue is not expected to be material to the Condensed Consolidated Statements of Operations during the fiscal year ending March 31, 2016, it is expected to have a material cumulative impact in subsequent periods.

Phase 2 DC’s agreements with distributors require the payment of VPFs, according to a defined fee schedule, for ten years from the date each system is installed; however, Phase 2 DC may no longer collect VPFs once “cost recoupment,” as defined in the agreements, is achieved.  Cost recoupment will occur once the cumulative VPFs and other cash receipts collected by Phase 2 DC have equaled the total of all cash outflows, including the purchase price of all Systems, all financing costs, all “overhead and ongoing costs”, as defined, and including service fees, subject to maximum agreed upon amounts during the three-year rollout period and thereafter.  Further, if cost recoupment occurs before the end of the eighth contract year, the studio will pay us a one-time “cost recoupment bonus”. Any other cash flows, net of expenses, received by Phase 2 DC following the achievement of cost recoupment are required to be returned to the distributors on a pro-rata basis. At this time, the Company cannot estimate the timing or probability of the achievement of cost recoupment. Beginning in December 2018, certain Phase 2 DC Systems will have reached the conclusion of their deployment payment period, subject to earlier achievement of cost recoupment. In accordance with existing agreements with distributors, VPF revenues will cease to be recognized on such Systems. Because the Phase II deployment installation period ended in December 2012, a majority of the VPF revenue associated with the Phase I systems will end by December 2022 or earlier if cost recoupment is achieved.

Alternative content fees (“ACFs”) are earned pursuant to contracts with movie exhibitors, whereby amounts are payable to Phase 1 DC and to Phase 2 DC, generally either a fixed amount or as a percentage of the applicable box office revenue derived from the exhibitor’s showing of content other than feature movies, such as concerts and sporting events (typically referred to as “alternative content”). ACF revenue is recognized in the period in which the alternative content first opens for audience viewing.

Revenues earned in connection with up front exhibitor contributions are deferred and recognized over the expected cost recoupment period.

Services

Exhibitors who purchased and own Systems using their own financing in the Phase II Deployment paid us an upfront activation fee that is generally $2.0 thousand per screen (the “Exhibitor-Buyer Structure”). These upfront activation fees are recognized in the period in which these Systems were delivered and are ready for content, as we had no further obligations to the customer after that time and collection was reasonably assured. In addition, we recognize activation fee revenue of between $1.0 thousand and $2.0 thousand on Phase 2 DC Systems and for Systems installed by CDF2 Holdings (See Note 4 - Other Interests) upon installation and such fees are generally collected upfront upon installation. Our services segment manages and collects VPFs on behalf of exhibitors, for which it earns an administrative fee equal to 10% of the VPFs collected.

Our Services segment earns an administrative fee of approximately 5% of VPFs collected and, in addition, earns an incentive service fee equal to 2.5% of the VPFs earned by Phase 1 DC. This administrative fee is recognized in the period in which the billing of VPFs occurs, as performance obligations have been substantially met at that time.

Content & Entertainment

CEG earns fees for the distribution of content in the home entertainment markets via several distribution channels, including digital, VOD, and physical goods (e.g., DVD and Blu-ray Discs). Fees earned are typically based on the gross amounts billed to our customers less the amounts owed to the media studios or content producers under distribution agreements, and gross media sales of owned or licensed content. Depending upon the nature of the agreements with the platform and content providers, the fee rate that we earn varies. Generally, revenues are recognized when content is available for subscription on the digital platform, at the time of shipment for physical goods, or point-of-sale for transactional and VOD services. Reserves for sales returns and other allowances are recorded based upon historical experience. If actual future returns and allowances differ from past experience, adjustments to our allowances may be required. Sales returns and allowances are reported as a reduction of revenues.

CEG also has contracts for the theatrical distribution of third party feature movies and alternative content. CEG’s distribution fee revenue and CEG's participation in box office receipts is recognized at the time a feature movie and alternative content are viewed. CEG has the right to receive or bill a portion of the theatrical distribution fee in advance of the exhibition date, and therefore such amount is recorded as a receivable at the time of execution, and all related distribution revenue is deferred until the theatrical release date of the third party feature movie or alternative content.

DIRECT OPERATING COSTS

DIRECT OPERATING COSTS

Direct operating costs primarily consist of operating costs such as cost of goods sold, fulfillment expenses, shipping costs, royalty expenses, participation expenses, marketing and

PARTICIPATIONS PAYABLE

PARTICIPATIONS AND ROYALTIES PAYABLE

We record liabilities within accounts payable and accrued expenses on the Condensed Consolidated Balance Sheet, that represent amounts owed to studios or content producers for royalties owed under licensing arrangements when we provide content distribution services. We identify and record as a reduction to the liability any expenses that are to be reimbursed to us by such studios or content producers.

DEBT ISSUANCE COSTS

DEBT ISSUANCE COSTS

We incur debt issuance costs in connection with long-term debt financings. Such costs are recorded as a direct deduction to notes payable and amortized over the terms of the respective debt obligations using the effective interest rate method (see Note 5 - Notes Payable). Debt issuance costs recorded in connection with revolving debt arrangements are presented in other assets on the Condensed Consolidated Balance Sheets and are amortized over the term of the revolving debt agreements using the effective interest rate method.

STOCK-BASED COMPENSATION

The risk-free interest rate used in the Black-Scholes option pricing model for options granted under our stock option plan awards is the historical yield on U.S. Treasury securities with equivalent remaining lives. We do not currently anticipate paying any cash dividends on common stock in the foreseeable future. Consequently, an expected dividend yield of zero is used in the Black-Scholes option pricing model.  We estimate the expected life of options granted under our stock option plans using both exercise behavior and post-vesting termination behavior, as well as consideration of outstanding options. We estimate expected volatility for options granted under our stock option plans based on a measure of our Class A common stock's historical volatility in the trading market.

NET LOSS PER SHARE

NET LOSS PER SHARE ATTRIBUTABLE TO COMMON SHAREHOLDERS

Basic and diluted net loss per common share has been calculated as follows:

Basic and diluted net loss per common share attributable to common stockholders =	Net loss attributable to common stockholders
	Weighted average number of common stock  outstanding during the period

Stock issued and treasury stock repurchased during the period are weighted for the portion of the period that they are outstanding. The shares to be repurchased in connection with the forward stock purchase transaction discussed in Note 6 - Stockholders' Deficit are considered repurchased for the purposes of calculating earnings per share and therefore the calculation of weighted average shares outstanding as of September 30, 2015 excludes approximately 11.8 million shares that will be repurchased as a result of the forward stock purchase transaction.

Loss per share from continuing operations is calculated similarly to basic and diluted loss per common share attributable to common shareholders, except that it uses loss from continuing operations in the numerator and takes into account the net loss attributable to noncontrolling interest.

RECENT ACCOUNTING PRONOUNCEMENTS

RECENT ACCOUNTING PRONOUNCEMENTS

In May 2014, the FASB issued new accounting guidance on revenue recognition. The new standard provides for a single five-step model to be applied to all revenue contracts with customers as well as requires additional financial statement disclosures that will enable users to understand the nature, amount, timing and uncertainty of revenue and cash flows relating to customer contracts. Companies have an option to use either a retrospective approach or cumulative effect adjustment approach to implement the standard. The guidance will be effective during our fiscal year ending March 31, 2019 with early adoption permitted. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In June 2014, the FASB issued an accounting standards update, which provides additional guidance on how to account for share-based payments where the terms of an award may provide that the performance target could be achieved after an employee completes the requisite service period. The amendments require that a performance target that affects vesting and that could be achieved after the requisite period is treated as a performance condition. The guidance will be effective during our fiscal year ending March 31, 2017. We are currently evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements. The standards update may be applied (a) prospectively to all awards granted or modified after the effective date or (b) retrospectively to all awards with performance targets that are outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In August 2014, the FASB amended accounting guidance pertaining to going concern considerations by company management. The amendments in this update state that in connection with preparing financial statements for each annual and interim reporting period, an entity's management should evaluate whether there are conditions or events that raise substantial doubt about the entity's ability to continue as a going concern within one year after the date that the financial statements are issued (or within one year after the date that the financial statements are available to be issued, when applicable). The guidance will be effective during our fiscal year ending March 31, 2018. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In February 2015, the FASB issued an accounting standards update, which amended accounting guidance on consolidation. The amendments affect reporting entities that are required to evaluate whether they should consolidate certain legal entities. All legal entities are subject to reevaluation under the revised consolidation model. The update will be effective during our fiscal year ending March 31, 2017. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In April 2015, the FASB issued new guidance related to the customer’s accounting for fees paid in a cloud computing arrangement, which provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, then the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The new guidance is effective for annual and interim reporting periods beginning after December 15, 2015. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

In July 2015, the FASB issued an accounting standards update that requires an entity to measure inventory balances at the lower of cost and net realizable value. Net realizable value is the estimated selling prices in the ordinary course of business, less reasonably predictable costs of completion, disposal, and transportation. Subsequent measurement is unchanged for inventory measured using LIFO or the retail inventory method. The amendments in this update are effective for the annual period ending after December 15, 2016, and for annual periods and interim periods thereafter. We are evaluating the impact of the adoption of this accounting standard update on our consolidated financial statements.

In September 2015, the FASB issued new guidance with respect to Business Combinations. The new guidance requires the acquirer in a Business Combination to recognize provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined. The new guidance is effective for public entities for which fiscal years begin after December 15, 2016, and interim periods within the fiscal years beginning after December 31, 2017. The accounting standard must be applied prospectively to adjustments to provisional amounts that occur after the effective date, with early adoption permitted. The adoption of this standard is not expected to have a material impact on our consolidated financial statements.

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Document and Entity Information - shares	6 Months Ended
	Sep. 30, 2015	Nov. 04, 2015
Document and Entity Information [Abstract]
Entity Central Index Key	0001173204
Entity Registrant Name	CINEDIGM CORP.
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Current Fiscal Year End Date	--03-31
Amendment Flag	false
Entity Common Stock, Shares Outstanding		75,085,433
Entity Filer Category	Accelerated Filer
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2016

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)

6 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

Estimated useful lives of Property and equipment

Depreciation expense is recorded using the straight-line method over the estimated useful lives of the respective assets as follows:

Computer equipment and software	3 - 5 years
Digital cinema projection systems	10 years
Machinery and equipment	3 - 10 years
Furniture and fixtures	3 - 6 years

Fair Value Measurements of financial assets

The following tables summarize the levels of fair value measurements of our financial assets and liabilities:

	As of September 30, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	8,983	$	—	$	—	$	8,983
Interest rate derivatives	—		172		—		172
	$	8,983	$	172	$	—	$	9,155

	As of March 31, 2015
(in thousands)	Level 1		Level 2		Level 3		Total
Restricted cash	$	6,751	$	—	$	—	$	6,751
Interest rate derivatives	—		208		—		208
	$	6,751	$	208	$	—	$	6,959

Schedule of Goodwill

Information related to the goodwill allocated to our Content & Entertainment segment is as follows:

(In thousands)	Goodwill
As of March 31, 2015	$	26,701
Goodwill impairment	(18,000		)
As of September 30, 2015	$	8,701

Gross amounts of goodwill and accumulated impairment charges that we have recorded are as follows:

(In thousands)	Goodwill
Goodwill	$	32,701
Accumulated impairment losses	(24,000		)
Net goodwill at September 30, 2015	$	8,701

Assumptions used in Black-Scholes option valuation model for estimating fair value of options

We estimated the fair value of stock options at the date of each grant using a Black-Scholes option valuation model with the following assumptions:

	For the Three Months Ended September 30,		For the Six Months Ended September 30,
Assumptions for Option Grants	2015	2014	2015	2014
Range of risk-free interest rates	1.5% - 1.6%	1.6 - 1.8%	1.4% - 1.7%	1.6 - 1.8%
Dividend yield	—	—	—	—
Expected life (years)	5	5	5	5
Range of expected volatilities	70.7 - 70.7%	71.4 - 71.5%	70.6 - 70.9%	71.4 - 72.3%

Employee stock-based compensation expense related to stock-based awards

Employee and director stock-based compensation expense from continuing operations related to our stock-based awards was as follows:

	For the Three Months Ended September 30,				For the Six Months Ended September 30,
(In thousands)	2015		2014		2015		2014
Direct operating	$	4	$	3	$	10	$	6
Selling, general and administrative	397		404		1,063		1,019
	$	401	$	407	$	1,073	$	1,025

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Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Income Statement [Abstract]
Revenues	$ 27,704	$ 23,721	$ 50,532	$ 46,578
Costs and expenses:
Direct operating (excludes depreciation and amortization shown below)	8,388	3,311	15,680	11,815
Selling, general and administrative	9,509	8,213	18,327	15,811
Provision for doubtful accounts	0	78	339	172
Restructuring, transition and acquisition expenses, net	63	817	196	1,763
Goodwill impairment	18,000	0	18,000	0
Litigation settlement recovery, net of expenses	(1,208)	91	(410)	202
Depreciation and amortization of property and equipment	9,427	9,391	18,784	18,767
Amortization of intangible assets	1,463	1,464	2,922	3,349
Total operating expenses	45,642	23,365	73,838	51,879
Income (loss) from operations	(17,938)	356	(23,306)	(5,301)
Interest expense, net	(5,192)	(4,993)	(10,322)	(10,028)
Loss on extinguishment of debt	0	0	(931)	0
Other income (expense), net	124	(39)	232	100
Change in fair value of interest rate derivatives	(68)	84	(66)	(175)
Loss from continuing operations	(23,074)	(4,592)	(34,393)	(15,404)
Income from discontinued operations	0	293	0	442
Loss on sale of discontinued operations	0	(3,045)	0	(3,045)
Net loss	(23,074)	(7,344)	(34,393)	(18,007)
Net loss attributable to noncontrolling interest	741	0	1,175	0
Net loss attributable to controlling interests	(22,333)	(7,344)	(33,218)	(18,007)
Preferred stock dividends	(89)	(89)	(178)	(178)
Net loss attributable to common stockholders	$ (22,422)	$ (7,433)	$ (33,396)	$ (18,185)
Net loss per Class A and Class B common stock attributable to common stockholders - basic and diluted:
Loss from continuing operations (in dollars per share)	$ (0.35)	$ (0.06)	$ (0.51)	$ (0.20)
Loss from discontinued operations (in dollars per share)	0.00	(0.04)	0.00	(0.03)
Net loss attributable to common stockholders (in dollars per share)	$ (0.35)	$ (0.10)	$ (0.51)	$ (0.23)
Weighted average number of Class A and Class B common shares outstanding: basic and diluted (shares)	63,236,908	76,748,753	65,200,093	76,659,162

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NOTES PAYABLE

6 Months Ended

Sep. 30, 2015

Debt Disclosure [Abstract]

NOTES PAYABLE

NOTES PAYABLE

Notes payable consisted of the following:

	September 30, 2015					March 31, 2015
(In thousands)	Current Portion		Long Term Portion			Current Portion		Long Term Portion
2013 Term Loans, net of debt discount	$	22,976	$	23,471		$	25,125	$	36,418
Prospect Loan	—		67,204			—		67,967
KBC Facilities	7,646		15,541			7,649		19,361
P2 Vendor Note	141		356			125		393
P2 Exhibitor Notes	77		147			74		186
Total non-recourse notes payable	30,840		106,719			32,973		124,325
Less: Unamortized debt issuance costs	—		(5,164		)	—		(5,938		)
Total non-recourse notes payable, net of unamortized debt issuance costs	$	30,840	$	101,555		$	32,973	$	118,387
5.5% Convertible Notes Due 2035	$	—	$	64,000		$	—	$	—
Cinedigm Term Loans	—		—			—		17,965
Cinedigm Revolving Loans	—		15,127			24,294		—
2013 Notes	—		3,932			—		3,785
Total recourse notes payable	—		83,059			24,294		21,750
Less: Unamortized debt issuance costs	—		(3,392		)	—		(750		)
Total recourse notes payable, net of unamortized debt issuance costs	$	—	$	79,667		$	24,294	$	21,000
Total notes payable, net of unamortized debt issuance costs	$	30,840	$	181,222		$	57,267	$	139,387

Non-recourse debt is generally defined as debt whereby the lenders’ sole recourse with respect to defaults, is limited to the value of the asset, which is collateral for the debt. Certain of our subsidiaries are liable with respect to, and their assets serve as collateral for, certain indebtedness for which our assets and the assets of our other subsidiaries that are not parties to the transaction are generally not liable. We have referred to this indebtedness as "non-recourse debt" because the recourse of the lenders is limited to the assets of specific subsidiaries. Such indebtedness includes the Prospect Loan, the KBC Facilities, the 2013 Term Loans, the P2 Vendor Note and the P2 Exhibitor Note.

2013 Term Loans

In February 2013, CDF I, our wholly owned subsidiary, entered into an amended and restated credit agreement (the “2013 Credit Agreement”) with Société Générale and other lenders. Under the terms of the 2013 Credit Agreement, CDF I may borrow an aggregate principal amount of $130.0 million, $5.0 million of which was allowed to be assigned to an affiliate of CDF I.

Under the 2013 Credit Agreement, each of the 2013 Term loans bear interest, at the option of CDF I, based on a base rate (generally, the bank prime rate) or the one-month LIBOR rate set at a minimum of 1.00%, plus a margin of 1.75% (in the case of base rate loans) or 2.75% (in the case of LIBOR rate loans). The 2013 Term Loans mature and must be paid in full by February 28, 2018. In addition, CDF I may prepay the 2013 Term Loans, in whole or in part, subject to paying certain breakage costs, if applicable. The one-month LIBOR rate at September 30, 2015 was 0.19%.

The 2013 Credit Agreement also requires each of CDF I’s existing and future direct and indirect domestic subsidiaries (the "Guarantors") to guarantee the obligations under the 2013 Credit Agreement with a first priority perfected security interest in all of the collective assets of CDF I and the Guarantors, including real estate owned or leased, and all capital stock or other equity interests in C/AIX, our wholly owned subsidiary and the direct holder of CDF I’s equity. The 2013 Credit Agreement contains customary representations, warranties, affirmative covenants, negative covenants and events of default.

Collections of CDF I accounts receivable are deposited into accounts designated to pay certain operating expenses, principal, interest, fees, costs and expenses relating to the 2013 Credit Agreement. Amounts designated for these purposes totaled $3.8 million and $3.9 million as of September 30, 2015 and March 31, 2015, respectively, and are included in cash and cash equivalents on our Condensed Consolidated Balance Sheets. We also maintain a debt service fund under the 2013 Credit Agreement for future principal and interest payments. As of September 30, 2015 and March 31, 2015, the debt service fund had a balance of $5.8 million, which is classified as restricted cash on our Condensed Consolidated Balance Sheets.

The balance of the 2013 Term Loans, net of the original issue discount, was as follows:

(In thousands)	September 30, 2015			March 31, 2015
2013 Term Loans, at issuance, net	$	125,087		$	125,087
Payments to date	(78,476		)	(63,348		)
Discount on 2013 Term Loans	(164		)	(196		)
2013 Term Loans, net	46,447			61,543
Less current portion	(22,976		)	(25,125		)
Total long term portion	$	23,471		$	36,418

Prospect Loan

In February 2013, our DC Holdings, AccessDM and Phase 2 DC subsidiaries entered into a term loan agreement (the “Prospect Loan”) with Prospect Capital Corporation (“Prospect”), pursuant to which DC Holdings borrowed $70.0 million. The Prospect Loan bears interest at LIBOR plus 9.0% (with a 2.0% LIBOR floor), which is payable in cash, and at an additional 2.50% to be accrued as an increase to the aggregate principal amount of the Prospect Loan until the 2013 Credit Agreement is paid off, at which time all accrued interest will be payable in cash.

Collections of DC Holdings accounts receivable are deposited into accounts designated to pay certain operating expenses, principal, interest, fees, costs and expenses relating to the Prospect Loan. On a quarterly basis, if funds remain after the payment of all such amounts, they are applied to prepay the Prospect Loan. Amounts designated for these purposes, included in cash and cash equivalents on the Condensed Consolidated Balance Sheets, totaled $1.9 million and $6.5 million as of September 30, 2015 and March 31, 2015, respectively. We also maintain a debt service fund under the Prospect Loan for future principal and interest payments. As of September 30, 2015 and March 31, 2015, the debt service fund had a balance of $1.0 million, which is classified as restricted cash on our Condensed Consolidated Balance Sheets.

The Prospect Loan matures on March 31, 2021 and may be accelerated upon a change in control (as defined in the agreement) or other events of default as set forth therein and would be subject to mandatory acceleration upon insolvency of DC Holdings. We are permitted to pay the full outstanding balance of the Prospect Loan at any time after the second anniversary of the initial borrowing, subject to the following prepayment penalties:

• 5.0% of the principal amount prepaid between the second and third anniversaries of issuance;

• 4.0% of the principal amount prepaid between the third and fourth anniversaries of issuance;

• 3.0% of the principal amount prepaid between the fourth and fifth anniversaries of issuance;

• 2.0% of the principal amount prepaid between the fifth and sixth anniversary of issuance;

• 1.0% of the principal amount prepaid between the sixth and seventh anniversaries of issuance; and

• No penalty if the balance of the Prospect Loan, including accrued interest, is prepaid thereafter.

The Prospect Loan is primarily secured by a first priority pledge of the stock of CDF2 Holdings, our wholly owned unconsolidated subsidiary, the stock of AccessDM, which is owned by DC Holdings, and the stock of our Phase 2 DC subsidiary. The Prospect Loan is also guaranteed by our AccessDM and Phase 2 DC subsidiaries. We provide limited financial support to the Prospect Loan not to exceed $1.5 million per year in the event financial performance does not meet certain defined benchmarks.

The Prospect Loan contains customary representations, warranties, affirmative covenants, negative covenants and events of default. The following table summarizes the activity related to the Prospect Loan:

(In thousands)	September 30, 2015			March 31, 2015
Prospect Loan, at issuance	$	70,000		$	70,000
PIK Interest	4,495			3,640
Payments to date	(7,291		)	(5,673		)
Prospect Loan, net	67,204			67,967
Less current portion	—			—
Total long term portion	$	67,204		$	67,967

KBC Facilities

In December 2008 we began entering into multiple credit facilities to fund the purchase of Systems to be installed in movie theatres as part of our Phase II Deployment. There were no borrowings under the KBC Facilities during the six months ended September 30, 2015. The following table presents a summary of the KBC Facilities (dollar amounts in thousands):

						Outstanding Principal Balance
Facility1	Credit Facility		Interest Rate2		Maturity Date	September 30, 2015	March 31, 2015
1	22,336		3.75	%	September 2018	8,776	10,371
2	13,312		3.75	%	March 2018	5,705	6,656
3	11,425		3.75	%	March 2019	5,712	6,528
4	6,450		3.75	%	September 2018	2,994	3,455
	$	53,523				23,187	27,010

^1.  For each facility, principal is to be repaid in twenty-eight quarterly installments.

^2.  Each of the facilities bears interest at the three-month LIBOR rate, which was 0.33% at September 30, 2015, plus the interest rate noted above.

5.5% Convertible Notes Due April 2035

On April 29, 2015, we issued $64.0 million aggregate principal amount of unsecured senior convertible notes payable (the "Convertible Notes") that bear interest at a rate of 5.5% per year, payable semiannually. The Convertible Notes will mature on April 15, 2035, unless repurchased earlier, redeemed or converted and will be convertible at the option of the holders at any time until the close of business on the business day immediately preceding the maturity date. Upon conversion, we will deliver to holders in respect of each $1,000 principal amount of Convertible Notes being converted a number of shares of our Class A common stock equal to the conversion rate, together with a cash payment in lieu of delivering any fractional share of Class A common stock. The conversion rate applicable to the Convertible Notes on the offering date was 824.5723 shares of Class A common stock per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $1.21 per share of Class A common stock), which is subject to adjustment if certain events occur. Holders of the Convertible Notes may require us to repurchase all or a portion of the Convertible Notes on April 20, 2020, April 20, 2025 and April 20, 2030 and upon the occurrence of certain fundamental changes at a repurchase price in cash equal to 100% of the principal amount of the Convertible Notes to be repurchased plus accrued and unpaid interest, if any. The Convertible Notes will be redeemable by us at our option on or after April 20, 2018 upon the satisfaction of a sale price condition with respect to our Class A common stock and on or after April 20, 2020 without regard to the sale price condition, in each case, at a redemption price in cash equal to 100% of the principal amount of the notes to be repurchased plus accrued and unpaid interest, if any.

The net proceeds from the Convertible Note offering was $60.9 million, after deducting offering expenses. We used $18.6 million of the net proceeds from the offering to repay borrowings under and terminate one of our term loans under our 2013 Credit Agreement, of which $18.2 million was used to pay the remaining principal balance. Concurrently with the closing of the Convertible Notes transaction, we repurchased 2.7 million shares of our Class A common stock from certain purchasers of Convertible Notes in privately negotiated transactions for $2.7 million. In addition, $11.4 million of the net proceeds was used to fund the cost of repurchasing 11.8 million shares of our Class A common stock pursuant to the forward stock purchase agreement described in Note 6 - Stockholders' Deficit. We recorded interest expense of $0.9 million and $1.5 million during the three months and six months ended September 30, 2015, respectively, related to the Convertible Notes.

We recorded debt issuance costs of $3.6 million related to the issuance of the Convertible Notes during the six months ended September 30, 2015.

Cinedigm Credit Agreement

On October 17, 2013, we entered into a credit agreement (the “Cinedigm Credit Agreement”) with Société Générale. Under the Cinedigm Credit Agreement, as amended in February 2015 and April 2015, we were permitted to borrow an aggregate principal amount of up to $55.0 million, including term loans of $25.0 million (the “Cinedigm Term Loans”) and revolving loans of up to $30.0 million (the “Cinedigm Revolving Loans”). Interest under the Cinedigm Term Loans was charged at a base rate plus 5.0%, or the Eurodollar rate plus 6.0% until the Cinedigm Term Loan was repaid on April 29, 2015 in connection with the Convertible Notes offering. The Cinedigm Revolving Loans bear interest at the base rate plus 4.0% or the Eurodollar rate plus 5.0%. The Base rate, per annum, is equal to the highest of (a) the rate quoted by the Wall Street Journal as the “base rate on corporate loans by at least 75% of the nation’s largest banks,” (b) 0.50% plus the federal funds rate, and (c) the Eurodollar rate plus 1.0%.

We repaid the entire outstanding balance of the Cinedigm Term Loans and amended the terms of the Cinedigm Revolving Loans in connection with our issuance of the Convertible Notes. In connection with the repayment of the Cinedigm Term Loans, we wrote-off certain unamortized debt issuance costs and the discount that remained on the balance of the note payable. As a result, we recorded $0.9 million as a loss on extinguishment of debt for the six months ended September 30, 2015.

The April 2015 amendment to the Cinedigm Revolving Loans extended the term of the agreement to March 31, 2018, provided for the release of the equity interests in the subsidiaries that we had previously pledged as collateral, changed the interest rate and replaced all financial covenants with a single debt service coverage ratio test commencing at June 30, 2016 and a $5.0 million minimum liquidity covenant. The Cinedigm Revolving Loans, as amended, bear interest at Base Rate (as defined in the amendment) plus 3% or LIBOR plus 4%, at our election, but in no event may the elected Base Rate or LIBOR rate be less than 1%. Availability under the Cinedigm Revolving Loans was $17.5 million, of which we borrowed $15.1 million as of September 30, 2015. We are permitted to repay the Cinedigm Revolving Loans, at our option, in whole or in part.

In accordance with the April 2015 amendment to the Cinedigm Revolving Loans, we maintain a debt service reserve account for the aggregate amount of scheduled interest and principal payments due on the Cinedigm Revolving Loans and Convertible notes over the next six months. As of September 30, 2015, we recorded restricted cash of $2.2 million related to the debt service reserve account. No such debt service account was maintained as of March 31, 2015.

2013 Notes

In October 2013, we entered into securities purchase agreements with certain investors, pursuant to which we sold notes in the aggregate principal amount of $5.0 million (the “2013 Notes”) and warrants to purchase an aggregate of 1,500,000 shares of Class A Common Stock (the “2013 Warrants”) to such investors. The proceeds of the sales of the 2013 Notes and 2013 Warrants were primarily used for working capital and general corporate purposes, including financing an acquisition. We allocated a proportional value of $1.6 million to the 2013 Warrants using a Black-Scholes option valuation model with the following assumptions:

Risk free interest rate	1.38	%
Dividend yield	—
Expected life (years)	5
Expected volatility	76.25	%

We have treated the implied fair value of the 2013 Warrants as a discount to the debt that was issued. The debt discount associated with the 2013 Notes is being amortized as interest expense, using the effective interest method, through the maturity of the 2013 Notes.

The principal amount outstanding under the 2013 Notes is due on October 21, 2018. The 2013 Notes bear interest at 9.0% per annum, payable in quarterly installments over the term of the 2013 Notes. The 2013 Notes may be redeemed at any time on or after October 21, 2015, subject to certain premiums.

At September 30, 2015, we were in compliance with all of our debt covenants.

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OTHER INTERESTS

6 Months Ended

Sep. 30, 2015

Noncontrolling Interest [Abstract]

Other Interests

OTHER INTERESTS

Investment in CDF2 Holdings

We indirectly own 100% of the common equity of CDF2 Holdings, LLC ("CDF2 Holdings"), which was created for the purpose of capitalizing on the conversion of the exhibition industry from film to digital technology. CDF2 Holdings assists its customers in procuring the equipment necessary to convert their Systems to digital technology by providing financing, equipment, installation and related ongoing services.

CDF2 Holdings is a Variable Interest Entity (“VIE”), as defined in Accounting Standards Codification Topic 810 ("ASC 810"), “Consolidation." ASC 810 requires the consolidation of VIEs by an entity that has a controlling financial interest in the VIE which entity is thereby defined as the primary beneficiary of the VIE. To be a primary beneficiary, an entity must have the power to direct the activities of a VIE that most significantly impact the VIE's economic performance, among other factors. Although we indirectly, wholly own CDF2 Holdings, we, a third party that also has a variable interest in CDF2 Holdings, and an independent third party manager must mutually approve all business activities and transactions that significantly impact CDF2 Holdings' economic performance. We have therefore assessed our variable interests in CDF2 Holdings and determined that we are not the primary beneficiary of CDF2 Holdings. As a result, CDF2 Holdings' financial position and results of operations are not consolidated in our financial position and results of operations. In completing our assessment, we identified the activities that we consider most significant to the economic performance of CDF2 Holdings and determined that we do not have the power to direct those activities, and therefore we account for our investment in CDF2 Holdings under the equity method of accounting.

As of September 30, 2015 and March 31, 2015, our maximum exposure to loss, as it relates to the non-consolidated CDF2 Holdings entity, represents accounts receivable for service fees under a master service agreement with CDF2 Holdings. Such accounts receivable were $0.4 million and $ $0.3 million as of September 30, 2015 and March 31, 2015, which are included in accounts receivable, net on the accompanying Condensed Consolidated Balance Sheets.

During each of the three months and six months ended September 30, 2015 and 2014, we received $0.3 million and $0.6 million, respectively, in aggregate revenues through digital cinema servicing fees from CDF2 Holdings, which are included in our revenues on the accompanying Condensed Consolidated Statements of Operations.

Total Stockholder's Deficit of CDF2 Holdings at September 30, 2015 and March 31, 2015 was $9.7 million and $6.7 million, respectively. We have no obligation to fund the operating loss or the stockholder's deficit beyond our initial investment of $2.0 million and, accordingly, our in investment in CDF2 Holdings as of September 30, 2015 and March 31, 2015 is carried at $0.

Noncontrolling Interest in CONtv

In June 2014, we and Wizard World, Inc. formed CON TV, LLC (“CONtv”) to fund, design, create, launch, and operate a worldwide digital network that creates original content, and sells and distributes on-demand digital content via the Internet and other consumer digital distribution platforms, such as gaming consoles, set-top boxes, handsets, and tablets.

We have determined that we have a controlling financial interest in CONtv. As a result, and in accordance with ASC 810, we have consolidated the financial position and results of operations of CONtv as of and for the six months ended September 30, 2015.

During the six months ended September 30, 2015, we made total contributions of $0.6 million in CONtv. Wizard World Inc.'s share of stockholders' deficit in CONtv is reflected as noncontrolling interest in our Condensed Consolidated Balance Sheets and was $0.8 million and $0.2 million as of September 30, 2015 and March 31, 2015, respectively. The noncontrolling interest's share of net loss was $1.2 million for the six months ended September 30, 2015.

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SEGMENT INFORMATION (Tables)

6 Months Ended

Sep. 30, 2015

Sep. 30, 2014

Segment Reporting [Abstract]

Schedule of Segment Reporting, Assets and Debt

The following tables present certain financial information related to our reportable segments and Corporate:

	As of September 30, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	233	$	—	$	60,682	$	108,979	$	—	$	—
Phase II Deployment	—		—		58,483		23,416		—		—
Services	—		—		1,597		—		—		—
Content & Entertainment	28,620		8,701		99,916		—		—		86
Corporate	12		—		18,228		—		79,667		5,107
Total	$	28,865	$	8,701	$	238,906	$	132,395	$	79,667	$	5,193

	As of March 31, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	252	$	—	$	74,595	$	123,722	$	—	$	—
Phase II Deployment	—		—		61,350		27,638		—		—
Services	—		—		1,084		—		—		—
Content & Entertainment	31,520		26,701		122,610		—		—		84
Corporate	12		—		13,378		—		45,294		5,411
Total	$	31,784	$	26,701	$	273,017	$	151,360	$	45,294	$	5,495

Schedule of Segment Reporting, Statement of Operations

	Statements of Operations
	For the Six Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	17,863		6,068		5,802		20,799			—			50,532
Direct operating (exclusive of depreciation and amortization shown below)	558		200		7		14,915			—			15,680
Selling, general and administrative	338		64		435		10,996			6,494			18,327
Allocation of Corporate overhead	—		—		807		2,701			(3,508		)	—
Provision for doubtful accounts	241		98		—		—			—			339
Restructuring, transition and acquisition expenses, net	—		—		—		—			196			196
Litigation settlement recovery, net of expenses	—		—		—		(410		)	—			(410		)
Goodwill impairment	—		—		—		18,000			—			18,000
Depreciation and amortization of property and equipment	14,304		3,762		—		151			567			18,784
Amortization of intangible assets	19		—		—		2,899			4			2,922
Total operating expenses	15,460		4,124		1,249		49,252			3,753			73,838
Income (loss) from operations	$	2,403	$	1,944	$	4,553	$	(28,453	)	$	(3,753	)	$	(23,306	)

	Statements of Operations
	For the Six Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I	Phase II	Services	Content & Entertainment		Corporate		Consolidated
Revenues	18,296	6,209	5,923	16,150		—		46,578
Direct operating (exclusive of depreciation and amortization shown below)	465	274	52	11,024		—		11,815
Selling, general and administrative	278	73	412	9,100		5,948		15,811
Allocation of Corporate overhead	—	—	925	2,689		(3,614	)	—
Provision for doubtful accounts	96	55	21	—		—		172
Restructuring, transition and acquisition expenses, net	—	—	—	1,418		345		1,763
Litigation and related expenses	—	—	—	202		—		202
Depreciation and amortization of property and equipment	14,275	3,762	106	92		532		18,767
Amortization of intangible assets	23	—	—	3,324		2		3,349
Total operating expenses	15,137	4,164	1,516	27,849		3,213		51,879
Income (loss) from operations	3,159	2,045	4,407	(11,699	)	(3,213	)	(5,301	)

	Statements of Operations
	For the Three Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	9,721	$	3,173	$	3,109	$	11,701		$	—		$	27,704
Direct operating (exclusive of depreciation and amortization shown below)	333		109		3		7,943			—			8,388
Selling, general and administrative	85		23		225		5,768			3,408			9,509
Allocation of Corporate overhead	—		—		405		1,354			(1,759		)	—
Provision for doubtful accounts	—		—		—		—			—			—
Restructuring, transition and acquisition expenses, net	—		—		—		—			63			63
Goodwill impairment	—		—		—		18,000			—			18,000
Litigation settlement recovery, net of expenses	—		—		—		(1,208		)	—			(1,208		)
Depreciation and amortization of property and equipment	7,151		1,881		—		111			284			9,427
Amortization of intangible assets	11		—		—		1,449			3			1,463
Total operating expenses	7,580		2,013		633		33,417			1,999			45,642
Income (loss) from operations	$	2,141	$	1,160	$	2,476	$	(21,716	)	$	(1,999	)	$	(17,938	)

	Statements of Operations
	For the Three Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	8,812	$	3,038	$	2,863	$	9,008		$	—		$	23,721
Direct operating (exclusive of depreciation and amortization shown below)	221		137		1		2,952			—			3,311
Selling, general and administrative	183		34		212		4,717			3,067			8,213
Allocation of Corporate overhead	—		—		459		1,336			(1,795		)	—
Provision for doubtful accounts	36		34		8		—			—			78
Restructuring, transition and acquisition expenses, net	—		—		—		576			241			817
Litigation and related expenses	—		—		—		91			—			91
Depreciation and amortization of property and equipment	7,138		1,881		53		51			268			9,391
Amortization of intangible assets	12		—		—		1,451			1			1,464
Total operating expenses	7,590		2,086		733		11,174			1,782			23,365
Income (loss) from operations	$	1,222	$	952	$	2,130	$	(2,166	)	$	(1,782	)	$	356

Schedule of Segement Reporting, Employee Stock-based Compensation Expense

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I	Phase II	Services	Content & Entertainment	Corporate	Consolidated
Direct operating	—	—	7	3	—	10
Selling, general and administrative	—	—	1	136	926	1,063
Total stock-based compensation	—	—	8	139	926	1,073

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	—	$	3	$	—	$	3
Selling, general and administrative	—		—		6		65		333		404
Total stock-based compensation	$	—	$	—	$	6	$	68	$	333	$	407

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	3	$	1	$	—	$	4
Selling, general and administrative	—		—		1		68		328		397
Total stock-based compensation	$	—	$	—	$	4	$	69	$	328	$	401

SEGMENT INFORMATION

SEGMENT INFORMATION

We operate in four reportable segments: Phase I Deployment, Phase II Deployment, Services and Content & Entertainment or CEG. Our segments were determined based on the economic characteristics of our products and services, our internal organizational structure, the manner in which our operations are managed and the criteria used by our Chief Operating Decision Maker to evaluate performance, which is generally the segment’s income (loss) from continuing operations before interest, taxes, depreciation and amortization. Certain Corporate assets, liabilities and operating expenses are not allocated to our reportable segments.

Operations of:	Products and services provided:
Phase I Deployment	Financing vehicles and administrators for our 3,724 Systems installed nationwide, for which we retain ownership of the Systems and the residual cash flows related to the Systems after the repayment of all non-recourse debt at the expiration of exhibitor master license agreements.
Phase II Deployment	Financing vehicles and administrators for our 8,904 Systems installed domestically and internationally, for which we retain no ownership of the residual cash flows and digital cinema equipment after the completion of cost recoupment and at the expiration of the exhibitor master license agreements.
Services	Provides monitoring, collection, verification and other management services to our Phase I Deployment, Phase II Deployment, CDF2 Holdings, as well as to exhibitors who purchase their own equipment. Services also collects and disburses VPFs from motion picture studios, distributors and ACFs from alternative content providers, movie exhibitors and theatrical exhibitors.
Content & Entertainment	Leading distributor of independent content, and collaborates with producers and other content owners to market, source, curate and distribute independent content to targeted and profitable audiences in theatres and homes, and via mobile and emerging platforms.

The following tables present certain financial information related to our reportable segments and Corporate:

	As of September 30, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	233	$	—	$	60,682	$	108,979	$	—	$	—
Phase II Deployment	—		—		58,483		23,416		—		—
Services	—		—		1,597		—		—		—
Content & Entertainment	28,620		8,701		99,916		—		—		86
Corporate	12		—		18,228		—		79,667		5,107
Total	$	28,865	$	8,701	$	238,906	$	132,395	$	79,667	$	5,193

	As of March 31, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	252	$	—	$	74,595	$	123,722	$	—	$	—
Phase II Deployment	—		—		61,350		27,638		—		—
Services	—		—		1,084		—		—		—
Content & Entertainment	31,520		26,701		122,610		—		—		84
Corporate	12		—		13,378		—		45,294		5,411
Total	$	31,784	$	26,701	$	273,017	$	151,360	$	45,294	$	5,495

	Statements of Operations
	For the Three Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	9,721	$	3,173	$	3,109	$	11,701		$	—		$	27,704
Direct operating (exclusive of depreciation and amortization shown below)	333		109		3		7,943			—			8,388
Selling, general and administrative	85		23		225		5,768			3,408			9,509
Allocation of Corporate overhead	—		—		405		1,354			(1,759		)	—
Provision for doubtful accounts	—		—		—		—			—			—
Restructuring, transition and acquisition expenses, net	—		—		—		—			63			63
Goodwill impairment	—		—		—		18,000			—			18,000
Litigation settlement recovery, net of expenses	—		—		—		(1,208		)	—			(1,208		)
Depreciation and amortization of property and equipment	7,151		1,881		—		111			284			9,427
Amortization of intangible assets	11		—		—		1,449			3			1,463
Total operating expenses	7,580		2,013		633		33,417			1,999			45,642
Income (loss) from operations	$	2,141	$	1,160	$	2,476	$	(21,716	)	$	(1,999	)	$	(17,938	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	3	$	1	$	—	$	4
Selling, general and administrative	—		—		1		68		328		397
Total stock-based compensation	$	—	$	—	$	4	$	69	$	328	$	401

	Statements of Operations
	For the Three Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	8,812	$	3,038	$	2,863	$	9,008		$	—		$	23,721
Direct operating (exclusive of depreciation and amortization shown below)	221		137		1		2,952			—			3,311
Selling, general and administrative	183		34		212		4,717			3,067			8,213
Allocation of Corporate overhead	—		—		459		1,336			(1,795		)	—
Provision for doubtful accounts	36		34		8		—			—			78
Restructuring, transition and acquisition expenses, net	—		—		—		576			241			817
Litigation and related expenses	—		—		—		91			—			91
Depreciation and amortization of property and equipment	7,138		1,881		53		51			268			9,391
Amortization of intangible assets	12		—		—		1,451			1			1,464
Total operating expenses	7,590		2,086		733		11,174			1,782			23,365
Income (loss) from operations	$	1,222	$	952	$	2,130	$	(2,166	)	$	(1,782	)	$	356

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	—	$	3	$	—	$	3
Selling, general and administrative	—		—		6		65		333		404
Total stock-based compensation	$	—	$	—	$	6	$	68	$	333	$	407

	Statements of Operations
	For the Six Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	17,863		6,068		5,802		20,799			—			50,532
Direct operating (exclusive of depreciation and amortization shown below)	558		200		7		14,915			—			15,680
Selling, general and administrative	338		64		435		10,996			6,494			18,327
Allocation of Corporate overhead	—		—		807		2,701			(3,508		)	—
Provision for doubtful accounts	241		98		—		—			—			339
Restructuring, transition and acquisition expenses, net	—		—		—		—			196			196
Litigation settlement recovery, net of expenses	—		—		—		(410		)	—			(410		)
Goodwill impairment	—		—		—		18,000			—			18,000
Depreciation and amortization of property and equipment	14,304		3,762		—		151			567			18,784
Amortization of intangible assets	19		—		—		2,899			4			2,922
Total operating expenses	15,460		4,124		1,249		49,252			3,753			73,838
Income (loss) from operations	$	2,403	$	1,944	$	4,553	$	(28,453	)	$	(3,753	)	$	(23,306	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I	Phase II	Services	Content & Entertainment	Corporate	Consolidated
Direct operating	—	—	7	3	—	10
Selling, general and administrative	—	—	1	136	926	1,063
Total stock-based compensation	—	—	8	139	926	1,073

	Statements of Operations
	For the Six Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I	Phase II	Services	Content & Entertainment		Corporate		Consolidated
Revenues	18,296	6,209	5,923	16,150		—		46,578
Direct operating (exclusive of depreciation and amortization shown below)	465	274	52	11,024		—		11,815
Selling, general and administrative	278	73	412	9,100		5,948		15,811
Allocation of Corporate overhead	—	—	925	2,689		(3,614	)	—
Provision for doubtful accounts	96	55	21	—		—		172
Restructuring, transition and acquisition expenses, net	—	—	—	1,418		345		1,763
Litigation and related expenses	—	—	—	202		—		202
Depreciation and amortization of property and equipment	14,275	3,762	106	92		532		18,767
Amortization of intangible assets	23	—	—	3,324		2		3,349
Total operating expenses	15,137	4,164	1,516	27,849		3,213		51,879
Income (loss) from operations	3,159	2,045	4,407	(11,699	)	(3,213	)	(5,301	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I	Phase II	Services	Content & Entertainment	Corporate	Consolidated
Direct operating	—	—	—	6	—	6
Selling, general and administrative	—	—	10	129	880	1,019
Total stock-based compensation	—	—	10	135	880	1,025

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DISCONTINUED OPERATIONS (Tables)

6 Months Ended

Sep. 30, 2015

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Income/Loss From Discontinued Operations

Details of income from discontinued operations are as follows:

(In thousands)	For the Three Months Ended September 30, 2014			For the Six Months Ended September 30, 2014
Revenues	$	919		$	1,968
Costs and Expenses:
Direct operating	151			326
Selling, general and administrative	561			1,093
Research and development	5			14
Total operating expenses	717			1,433
Income from operations	202			535
Other expense, net	(8		)	(93		)
Income before provision for income taxes	194			442
Provision for income taxes	99			—
Income from discontinued operations, net of taxes	$	293		$	442

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SUPPLEMENTAL CASH FLOW INFORMATION

6 Months Ended

Sep. 30, 2015

Supplemental Cash Flow Elements [Abstract]

SUPPLEMENTAL CASH FLOW DISCLOSURE

SUPPLEMENTAL CASH FLOW INFORMATION

	For the Six Months Ended September 30,
(in thousands)	2015		2014
Cash interest paid	$	6,571	$	8,474
Accrued dividends on preferred stock	$	89	$	178
Issuance of common stock for payment of preferred stock dividends	$	178	$	178
Deferred consideration recorded in connection with sale of business	$	—	$	1,050

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STOCKHOLDERS' EQUITY

6 Months Ended

Sep. 30, 2015

Equity [Abstract]

STOCKHOLDERS' EQUITY

STOCKHOLDERS’ DEFICIT

COMMON STOCK

During the six months ended September 30, 2015, we issued 679,379 shares of Class A common stock as payment for services rendered by our Board of Directors and certain other third-party advisory services, payment of preferred stock dividends and the exercise of employee stock options.

PREFERRED STOCK

Cumulative dividends in arrears on preferred stock at September 30, 2015 and March 31, 2015 were $0.1 million. In October 2015, we paid preferred stock dividends accrued at September 30, 2015 in the form of 114,644 shares of Class A Common Stock.

TREASURY STOCK

In connection with the offering of Convertible Notes, on April 29, 2015, we repurchased 2,721,000 shares of our Class A common stock from certain purchasers of Convertible Notes in privately negotiated transactions for $2.7 million, which is reflected as treasury stock in our Condensed Consolidated Balance Sheet as of September 30, 2015. In addition, we entered into a privately negotiated forward stock purchase transaction with a financial institution, which is one of the lenders under our credit agreement (the "Forward Counterparty"), pursuant to which we paid $11.4 million to purchase 11,791,384 shares of our Class A common stock for settlement that may be settled at any time prior to the fifth year anniversary of the issuance date of the notes. The payment for the forward contract has been reflected as a reduction of Additional Paid-in Capital on our Condensed Consolidated Balance Sheet until such time that the forward contract is settled and the shares are legally delivered to and owned by us. Upon settlement of the forward contract and delivery of the stock, we will reclassify such amount to treasury stock.

CINEDIGM’S EQUITY INCENTIVE PLAN

Stock Options

Awards issued under our equity incentive plan (the "Plan") may be in any of the following forms (or a combination thereof) (i) stock option awards; (ii) stock appreciation rights; (iii) stock or restricted stock or restricted stock units; or (iv) performance awards. The Plan provides for the granting of incentive stock options (“ISOs”) with exercise prices not less than the fair market value of our Class A Common Stock on the date of grant. ISOs granted to shareholders having more than 10% of the total combined voting power of the Company must have exercise prices of at least 110% of the fair market value of our Class A Common Stock on the date of grant. ISOs and non-statutory stock options granted under the Plan are subject to vesting provisions, and exercise is subject to the continuous service of the participant. The exercise prices and vesting periods (if any) for non-statutory options are set at the discretion of our compensation committee. Upon a change of control of the Company, all stock options (incentive and non-statutory) that have not previously vested will vest immediately and become fully exercisable. In connection with the grants of stock options under the Plan, we and the participants have executed stock option agreements setting forth the terms of the grants. The Plan provides for the issuance of up to 14,300,000 shares of Class A Common Stock to employees, outside directors and consultants.

The following table summarizes the activity of the Plan related to shares issuable pursuant to outstanding options:

	Shares Under Option		Weighted Average Exercise Price Per Share
Balance at March 31, 2015	5,908,670		$	1.72
Granted	130,000		1.51
Exercised	(25,000	)	0.89
Canceled/forfeited	(364,438	)	1.92
Balance at September 30, 2015	5,649,232		1.69

Stock options granted under the Plan during the six months ended September 30, 2015 vest and become exercisable in 25% increments over four years from their grant dates. The weighted average remaining contractual life for stock options outstanding as of September 30, 2015 was 6.78 years.

OPTIONS GRANTED OUTSIDE CINEDIGM’S EQUITY INCENTIVE PLAN

In October 2013, we issued options outside of the Plan to 10 individuals that became employees as a result of a business combination. The employees received options to purchase an aggregate of 620,000 shares of our Class A Common Stock at an exercise price of $1.75 per share. The options vest and become exercisable in 25% increments over four years from their grant dates and expire 10 years from the date of grant, if unexercised. As of September 30, 2015, there were 348,750 unvested options outstanding.

In December 2010, we issued options to purchase 4,500,000 shares of Class A Common Stock outside of the Plan as part of our Chief Executive Officer's initial employment agreement with the Company. Such options have exercise prices per share between $1.50 and $5.00, all of which were vested as of December 2013 and will expire in December 2020. As of September 30, 2015, all such options remained outstanding.

WARRANTS

The following table presents information about outstanding warrants to purchase shares of our Class A common stock as of September 30, 2015. All of the outstanding warrants are fully vested and exercisable.

Recipient	Amount outstanding	Expiration	Exercise price per share
Sageview Capital, L.P	16,732,824	August 2016	$1.31
Strategic management service provider	525,000	July 2021	$1.72 - $3.00
Warrants issued to creditors in connection with the 2013 Notes (the "2013 Warrants")	1,250,625	October 2018	$1.85

Outstanding warrants held by Sageview Capital, L.P. ("Sageview") contain customary provisions for cashless exercises and anti-dilution adjustments. In addition, the warrants' expiration date may be extended in limited circumstances.  On April 29, 2015, the number of shares underlying the warrants issued to Sageview and their related exercise price were adjusted from 16,000,000 and $1.37 to 16,732,824 and $1.31, respectively, to give effect to an anti-dilution adjustment that resulted from the issuance of the Convertible Notes.

Outstanding warrants held by the strategic management service provider were issued in connection with a consulting management services agreement ("MSA"). The warrants may be terminated with 90 days' notice in the event of termination of the MSA.

The 2013 Warrants and related 2013 Notes are subject to certain transfer restrictions.

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COMMITMENTS AND CONTINGENCIES

6 Months Ended

Sep. 30, 2015

Commitments and Contingencies Disclosure [Abstract]

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES

LEASES

We have capital lease obligations covering a facility and computer equipment. In May 2011, we completed the sale of certain assets and liabilities of the Pavilion Theatre and ceased to operate it at that time. We have remained the primary obligor on the Pavilion capital lease and therefore, the capital lease obligation and the related assets under the capital lease continue to be reflected on our Consolidated Balance Sheets as of September 30, 2015 and March 31, 2015. We have entered into a sub-lease agreement with an unrelated third party purchaser who makes all payments related to the lease and therefore, we have no continuing involvement in the operation of the Pavilion Theatre.

We also operate from leased properties under non-cancelable operating lease agreements, certain of which contain escalating lease clauses.

LITIGATION

Gaiam Dispute

On September 30, 2015, we entered into a Confidential Settlement Agreement and Release (the “Settlement”) with Gaiam, Inc. and Gaiam Americas, Inc. (together, “Gaiam”) relating to disputes arising from our October 2013 acquisition of a division of Gaiam that maintained exclusive distribution rights agreements with large independent studios/content providers, and distributed entertainment content through home video, digital and television distribution channels (the “GVE Acquisition”).

As previously disclosed, we initiated mediation with Gaiam in August 2014 with respect to certain claims resulting from the GVE Acquisition in accordance with the requirements of the Membership Interest Purchase Agreement (the “MIPA”). In January 2015, we participated in a two-day mediation with Gaiam to determine whether the parties’ disputes could be resolved informally without arbitration. The mediation was not successful, and, therefore, the parties pursued their claims and counterclaims against each other through arbitration. After certain procedural disputes, the parties proceeded with two arbitrations, one before a nationally recognized accounting firm to determine the value of the working capital in accordance with the relevant procedures set forth in the MIPA and the other before the American Arbitration Association to resolve the parties’ non-working capital disputes.

The Settlement resolved the claims and counterclaims in both arbitrations and Gaiam agreed to an initial Settlement payment of $2.3 million and a subsequent Settlement payment in an amount to be determined in arbitration.  The Settlement sets a schedule for the arbitration that contemplates its conclusion within approximately 90 days, subject to either party’s right to file a petition to vacate and/or modify the final award determined by the arbitrator. As a result, for the three months and six months ended September 30, 2015, we have recorded the initial Settlement payment as litigation recovery, net of expenses in the Condensed Consolidated Statement of Operations. The initial settlement payment was received in October 2015.

We are subject to certain legal proceedings in the ordinary course of business. We do not expect any such items to have a significant impact on our financial position and results of operations and liquidity.

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SEGMENT INFORMATION

6 Months Ended

Sep. 30, 2014

Segment Reporting [Abstract]

SEGMENT INFORMATION

SEGMENT INFORMATION

We operate in four reportable segments: Phase I Deployment, Phase II Deployment, Services and Content & Entertainment or CEG. Our segments were determined based on the economic characteristics of our products and services, our internal organizational structure, the manner in which our operations are managed and the criteria used by our Chief Operating Decision Maker to evaluate performance, which is generally the segment’s income (loss) from continuing operations before interest, taxes, depreciation and amortization. Certain Corporate assets, liabilities and operating expenses are not allocated to our reportable segments.

Operations of:	Products and services provided:
Phase I Deployment	Financing vehicles and administrators for our 3,724 Systems installed nationwide, for which we retain ownership of the Systems and the residual cash flows related to the Systems after the repayment of all non-recourse debt at the expiration of exhibitor master license agreements.
Phase II Deployment	Financing vehicles and administrators for our 8,904 Systems installed domestically and internationally, for which we retain no ownership of the residual cash flows and digital cinema equipment after the completion of cost recoupment and at the expiration of the exhibitor master license agreements.
Services	Provides monitoring, collection, verification and other management services to our Phase I Deployment, Phase II Deployment, CDF2 Holdings, as well as to exhibitors who purchase their own equipment. Services also collects and disburses VPFs from motion picture studios, distributors and ACFs from alternative content providers, movie exhibitors and theatrical exhibitors.
Content & Entertainment	Leading distributor of independent content, and collaborates with producers and other content owners to market, source, curate and distribute independent content to targeted and profitable audiences in theatres and homes, and via mobile and emerging platforms.

The following tables present certain financial information related to our reportable segments and Corporate:

	As of September 30, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	233	$	—	$	60,682	$	108,979	$	—	$	—
Phase II Deployment	—		—		58,483		23,416		—		—
Services	—		—		1,597		—		—		—
Content & Entertainment	28,620		8,701		99,916		—		—		86
Corporate	12		—		18,228		—		79,667		5,107
Total	$	28,865	$	8,701	$	238,906	$	132,395	$	79,667	$	5,193

	As of March 31, 2015
(In thousands)	Intangible Assets, net		Goodwill		Total Assets		Notes Payable, Non-Recourse		Notes Payable		Capital Leases
Phase I Deployment	$	252	$	—	$	74,595	$	123,722	$	—	$	—
Phase II Deployment	—		—		61,350		27,638		—		—
Services	—		—		1,084		—		—		—
Content & Entertainment	31,520		26,701		122,610		—		—		84
Corporate	12		—		13,378		—		45,294		5,411
Total	$	31,784	$	26,701	$	273,017	$	151,360	$	45,294	$	5,495

	Statements of Operations
	For the Three Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	9,721	$	3,173	$	3,109	$	11,701		$	—		$	27,704
Direct operating (exclusive of depreciation and amortization shown below)	333		109		3		7,943			—			8,388
Selling, general and administrative	85		23		225		5,768			3,408			9,509
Allocation of Corporate overhead	—		—		405		1,354			(1,759		)	—
Provision for doubtful accounts	—		—		—		—			—			—
Restructuring, transition and acquisition expenses, net	—		—		—		—			63			63
Goodwill impairment	—		—		—		18,000			—			18,000
Litigation settlement recovery, net of expenses	—		—		—		(1,208		)	—			(1,208		)
Depreciation and amortization of property and equipment	7,151		1,881		—		111			284			9,427
Amortization of intangible assets	11		—		—		1,449			3			1,463
Total operating expenses	7,580		2,013		633		33,417			1,999			45,642
Income (loss) from operations	$	2,141	$	1,160	$	2,476	$	(21,716	)	$	(1,999	)	$	(17,938	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	3	$	1	$	—	$	4
Selling, general and administrative	—		—		1		68		328		397
Total stock-based compensation	$	—	$	—	$	4	$	69	$	328	$	401

	Statements of Operations
	For the Three Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	$	8,812	$	3,038	$	2,863	$	9,008		$	—		$	23,721
Direct operating (exclusive of depreciation and amortization shown below)	221		137		1		2,952			—			3,311
Selling, general and administrative	183		34		212		4,717			3,067			8,213
Allocation of Corporate overhead	—		—		459		1,336			(1,795		)	—
Provision for doubtful accounts	36		34		8		—			—			78
Restructuring, transition and acquisition expenses, net	—		—		—		576			241			817
Litigation and related expenses	—		—		—		91			—			91
Depreciation and amortization of property and equipment	7,138		1,881		53		51			268			9,391
Amortization of intangible assets	12		—		—		1,451			1			1,464
Total operating expenses	7,590		2,086		733		11,174			1,782			23,365
Income (loss) from operations	$	1,222	$	952	$	2,130	$	(2,166	)	$	(1,782	)	$	356

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I		Phase II		Services		Content & Entertainment		Corporate		Consolidated
Direct operating	$	—	$	—	$	—	$	3	$	—	$	3
Selling, general and administrative	—		—		6		65		333		404
Total stock-based compensation	$	—	$	—	$	6	$	68	$	333	$	407

	Statements of Operations
	For the Six Months Ended September 30, 2015
	(Unaudited, in thousands)
	Phase I		Phase II		Services		Content & Entertainment			Corporate			Consolidated
Revenues	17,863		6,068		5,802		20,799			—			50,532
Direct operating (exclusive of depreciation and amortization shown below)	558		200		7		14,915			—			15,680
Selling, general and administrative	338		64		435		10,996			6,494			18,327
Allocation of Corporate overhead	—		—		807		2,701			(3,508		)	—
Provision for doubtful accounts	241		98		—		—			—			339
Restructuring, transition and acquisition expenses, net	—		—		—		—			196			196
Litigation settlement recovery, net of expenses	—		—		—		(410		)	—			(410		)
Goodwill impairment	—		—		—		18,000			—			18,000
Depreciation and amortization of property and equipment	14,304		3,762		—		151			567			18,784
Amortization of intangible assets	19		—		—		2,899			4			2,922
Total operating expenses	15,460		4,124		1,249		49,252			3,753			73,838
Income (loss) from operations	$	2,403	$	1,944	$	4,553	$	(28,453	)	$	(3,753	)	$	(23,306	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I	Phase II	Services	Content & Entertainment	Corporate	Consolidated
Direct operating	—	—	7	3	—	10
Selling, general and administrative	—	—	1	136	926	1,063
Total stock-based compensation	—	—	8	139	926	1,073

	Statements of Operations
	For the Six Months Ended September 30, 2014
	(Unaudited, in thousands)
	Phase I	Phase II	Services	Content & Entertainment		Corporate		Consolidated
Revenues	18,296	6,209	5,923	16,150		—		46,578
Direct operating (exclusive of depreciation and amortization shown below)	465	274	52	11,024		—		11,815
Selling, general and administrative	278	73	412	9,100		5,948		15,811
Allocation of Corporate overhead	—	—	925	2,689		(3,614	)	—
Provision for doubtful accounts	96	55	21	—		—		172
Restructuring, transition and acquisition expenses, net	—	—	—	1,418		345		1,763
Litigation and related expenses	—	—	—	202		—		202
Depreciation and amortization of property and equipment	14,275	3,762	106	92		532		18,767
Amortization of intangible assets	23	—	—	3,324		2		3,349
Total operating expenses	15,137	4,164	1,516	27,849		3,213		51,879
Income (loss) from operations	3,159	2,045	4,407	(11,699	)	(3,213	)	(5,301	)

The following employee and director stock-based compensation expense related to the Company’s stock-based awards is included in the above amounts as follows:

	Phase I	Phase II	Services	Content & Entertainment	Corporate	Consolidated
Direct operating	—	—	—	6	—	6
Selling, general and administrative	—	—	10	129	880	1,019
Total stock-based compensation	—	—	10	135	880	1,025

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NOTES PAYABLE - SCHEDULE OF NOTES PAYABLE OUTSTANDING (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Mar. 31, 2015	Feb. 28, 2013
Notes Payable:
Current portion	$ 30,840	$ 57,267
Long Term Portion	181,222	139,387
2013 Term Loans
Notes Payable:
Current portion	22,976	25,125
Long Term Portion	23,471	36,418
2013 Prospect Term Loan Agreement
Notes Payable:
Debt Instrument, Interest Rate, Stated Percentage			2.50%
Current portion	0	0
Long Term Portion	67,204	67,967
Non-recourse Notes Payable [Member]
Notes Payable:
Current portion gross	30,840	32,973
Unamortized debt issuance cost, current	0	0
Current portion	30,840	32,973
Long term portion gross	106,719	124,325
Unamortized debt issuance long term	(5,164)	(5,938)
Long Term Portion	101,555	118,387
Non-recourse Notes Payable [Member] | 2013 Term Loans
Notes Payable:
Current portion gross	22,976	25,125
Long term portion gross	23,471	36,418
Non-recourse Notes Payable [Member] | 2013 Prospect Term Loan Agreement
Notes Payable:
Current portion gross	0	0
Long term portion gross	67,204	67,967
Non-recourse Notes Payable [Member] | KBC Facilities
Notes Payable:
Current portion gross	7,646	7,649
Long term portion gross	15,541	19,361
Non-recourse Notes Payable [Member] | P2 Vendor Notes
Notes Payable:
Current portion gross	141	125
Long term portion gross	356	393
Non-recourse Notes Payable [Member] | P2 Exhibitor Notes
Notes Payable:
Current portion gross	77	74
Long term portion gross	147	186
Recourse Notes Payable [Member]
Notes Payable:
Current portion gross	0	24,294
Unamortized debt issuance cost, current	0	0
Current portion	0	24,294
Long term portion gross	83,059	21,750
Unamortized debt issuance long term	(3,392)	(750)
Long Term Portion	$ 79,667	$ 21,000
Recourse Notes Payable [Member] | 5.5% Senior Convertible Notes Due 2035
Notes Payable:
Debt Instrument, Interest Rate, Stated Percentage	5.50%	5.50%
Current portion gross	$ 0	$ 0
Long term portion gross	64,000	0
Recourse Notes Payable [Member] | Cinedigm Term Loans [Member]
Notes Payable:
Current portion gross	0	0
Long term portion gross	0	17,965
Recourse Notes Payable [Member] | Cinedigm Revolving loans
Notes Payable:
Current portion gross	0	24,294
Long term portion gross	15,127	0
Recourse Notes Payable [Member] | Notes 2013 Due 2018
Notes Payable:
Current portion gross	0	0
Long term portion gross	$ 3,932	$ 3,785

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STOCKHOLDERS' EQUITY (Tables)

6 Months Ended

Sep. 30, 2015

Equity [Abstract]

Schedule of Outstanding Stock Options

The following table summarizes the activity of the Plan related to shares issuable pursuant to outstanding options:

	Shares Under Option		Weighted Average Exercise Price Per Share
Balance at March 31, 2015	5,908,670		$	1.72
Granted	130,000		1.51
Exercised	(25,000	)	0.89
Canceled/forfeited	(364,438	)	1.92
Balance at September 30, 2015	5,649,232		1.69

Schedule of Warrants

The following table presents information about outstanding warrants to purchase shares of our Class A common stock as of September 30, 2015. All of the outstanding warrants are fully vested and exercisable.

Recipient	Amount outstanding	Expiration	Exercise price per share
Sageview Capital, L.P	16,732,824	August 2016	$1.31
Strategic management service provider	525,000	July 2021	$1.72 - $3.00
Warrants issued to creditors in connection with the 2013 Notes (the "2013 Warrants")	1,250,625	October 2018	$1.85

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - RESTRICTED CASH (Details) - USD ($) $ in Thousands	Sep. 30, 2015	Mar. 31, 2015
Restricted Cash and Investments [Abstract]
Reserve account related to the Term Loans	$ 8,983	$ 6,751
2013 Prospect Term Loan Agreement
Restricted Cash and Investments [Abstract]
Reserve account related to the Term Loans	$ 1,000	$ 1,000

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SEGMENT INFORMATION - EMPLOYEE STOCK-BASED COMPENSATION EXPENSE (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	$ 401	$ 407	$ 1,073	$ 1,025
Direct operating
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	4	3	10	6
Selling, general and administrative
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	397	404	1,063	1,019
Phase I
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	0	0	0	0
Phase I | Direct operating
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	0	0	0	0
Phase I | Selling, general and administrative
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	0	0	0	0
Phase II
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	0	0	0	0
Phase II | Direct operating
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	0	0	0	0
Phase II | Selling, general and administrative
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	0	0	0	0
Services
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	4	6	8	10
Services | Direct operating
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	3	0	7	0
Services | Selling, general and administrative
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	1	6	1	10
Content and Entertainment Segment [Member]
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	69	68	139	135
Content and Entertainment Segment [Member] | Direct operating
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	1	3	3	6
Content and Entertainment Segment [Member] | Selling, general and administrative
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	68	65	136	129
Corporate
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	328	333	926	880
Corporate | Direct operating
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	0	0	0	0
Corporate | Selling, general and administrative
Segment Reporting, Other Significant Reconciling Item [Line Items]
Total stock-based compensation	$ 328	$ 333	$ 926	$ 880

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STOCKHOLDERS' EQUITY - TREASURY STOCK (Details) - Convertible Debt [Member] - Convertible Notes [Member] $ in Millions	Apr. 29, 2015 USD ($) shares
Class of Stock [Line Items]
Treasury Stock, Shares, Acquired	2,721,000
Treasury Stock, Value, Acquired, Cost Method | $	$ 2.7
Forward Stock Purchase Transaction [Member]
Class of Stock [Line Items]
Treasury Stock, Shares, Acquired	11,791,384
Treasury Stock, Value, Acquired, Cost Method | $	$ 11.4

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Consolidated Statements of Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Statement of Comprehensive Income [Abstract]
Net loss	$ (23,074)	$ (7,344)	$ (34,393)	$ (18,007)
Other comprehensive income (loss): foreign exchange translation	32	(54)	30	2
Comprehensive loss	(23,042)	(7,398)	(34,363)	(18,005)
Less: comprehensive loss attributable to noncontrolling interest	(741)	0	(1,175)	0
Comprehensive loss attributable to controlling interests	$ (22,301)	$ (7,398)	$ (33,188)	$ (18,005)

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DISCONTINUED OPERATIONS

6 Months Ended

Sep. 30, 2015

Discontinued Operations and Disposal Groups [Abstract]

ASSETS HELD FOR SALE AND DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS

During the fiscal year ended March 31, 2014, we made the strategic decision to discontinue and exit our software business and therefore executed a plan of sale for Hollywood Software, Inc. d/b/a Cinedigm Software (“Software”), our direct, wholly owned subsidiary, in order to focus on physical and digital distribution of entertainment content and servicing our existing digital cinema business. Furthermore, we believed that Software, which was previously included in our Services segment, no longer complemented our businesses. On September 23, 2014, we completed the sale of Software to a third party and recognized a $3.0 million loss on the sale of the business for the three and six months ended September 30, 2014. As a result, Software has been reclassified as discontinued operations for the three and six months ended September 30, 2014.

Details of income from discontinued operations are as follows:

(In thousands)	For the Three Months Ended September 30, 2014			For the Six Months Ended September 30, 2014
Revenues	$	919		$	1,968
Costs and Expenses:
Direct operating	151			326
Selling, general and administrative	561			1,093
Research and development	5			14
Total operating expenses	717			1,433
Income from operations	202			535
Other expense, net	(8		)	(93		)
Income before provision for income taxes	194			442
Provision for income taxes	99			—
Income from discontinued operations, net of taxes	$	293		$	442

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - PROPERTY AND EQUIPMENT (Details)	6 Months Ended
	Sep. 30, 2015
Computer Equipment and Software [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	3 years
Computer Equipment and Software [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	5 years
Digital Cinema Projection Systems [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	10 years
Machinery and Equipment [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	3 years
Machinery and Equipment [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	10 years
Furniture and Fixtures [Member] | Minimum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	3 years
Furniture and Fixtures [Member] | Maximum [Member]
Property, Plant and Equipment [Line Items]
Property and equipment estimated useful lives	6 years

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NOTES PAYABLE - FAIR VALUE ASSUMPTIONS (Details) - Warrant [Member]	Oct. 23, 2013
Debt Instrument [Line Items]
Fair Value Assumptions, Risk Free Interest Rate	1.38%
Fair Value Assumptions, Expected Dividend Rate	0.00%
Fair Value Assumptions, Expected Term	5 years
Fair Value Assumptions, Expected Volatility Rate	76.25%

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NOTES PAYABLE (Tables)

6 Months Ended

Sep. 30, 2015

Debt Instrument [Line Items]

Schedule of Notes Payable

Notes payable consisted of the following:

	September 30, 2015					March 31, 2015
(In thousands)	Current Portion		Long Term Portion			Current Portion		Long Term Portion
2013 Term Loans, net of debt discount	$	22,976	$	23,471		$	25,125	$	36,418
Prospect Loan	—		67,204			—		67,967
KBC Facilities	7,646		15,541			7,649		19,361
P2 Vendor Note	141		356			125		393
P2 Exhibitor Notes	77		147			74		186
Total non-recourse notes payable	30,840		106,719			32,973		124,325
Less: Unamortized debt issuance costs	—		(5,164		)	—		(5,938		)
Total non-recourse notes payable, net of unamortized debt issuance costs	$	30,840	$	101,555		$	32,973	$	118,387
5.5% Convertible Notes Due 2035	$	—	$	64,000		$	—	$	—
Cinedigm Term Loans	—		—			—		17,965
Cinedigm Revolving Loans	—		15,127			24,294		—
2013 Notes	—		3,932			—		3,785
Total recourse notes payable	—		83,059			24,294		21,750
Less: Unamortized debt issuance costs	—		(3,392		)	—		(750		)
Total recourse notes payable, net of unamortized debt issuance costs	$	—	$	79,667		$	24,294	$	21,000
Total notes payable, net of unamortized debt issuance costs	$	30,840	$	181,222		$	57,267	$	139,387

Schedule of Credit Facilities

The following table presents a summary of the KBC Facilities (dollar amounts in thousands):

						Outstanding Principal Balance
Facility1	Credit Facility		Interest Rate2		Maturity Date	September 30, 2015	March 31, 2015
1	22,336		3.75	%	September 2018	8,776	10,371
2	13,312		3.75	%	March 2018	5,705	6,656
3	11,425		3.75	%	March 2019	5,712	6,528
4	6,450		3.75	%	September 2018	2,994	3,455
	$	53,523				23,187	27,010

^1.  For each facility, principal is to be repaid in twenty-eight quarterly installments.

^2.  Each of the facilities bears interest at the three-month LIBOR rate, which was 0.33% at September 30, 2015, plus the interest rate noted above.

Schedule of Assumptions for Fair Value of Warrant LIabilities

Risk free interest rate	1.38	%
Dividend yield	—
Expected life (years)	5
Expected volatility	76.25	%

2013 Term Loans

Debt Instrument [Line Items]

Schedule of Debt Outstanding

The balance of the 2013 Term Loans, net of the original issue discount, was as follows:

(In thousands)	September 30, 2015			March 31, 2015
2013 Term Loans, at issuance, net	$	125,087		$	125,087
Payments to date	(78,476		)	(63,348		)
Discount on 2013 Term Loans	(164		)	(196		)
2013 Term Loans, net	46,447			61,543
Less current portion	(22,976		)	(25,125		)
Total long term portion	$	23,471		$	36,418

2013 Prospect Term Loan Agreement

Debt Instrument [Line Items]

Schedule of Debt Outstanding

(In thousands)	September 30, 2015			March 31, 2015
Prospect Loan, at issuance	$	70,000		$	70,000
PIK Interest	4,495			3,640
Payments to date	(7,291		)	(5,673		)
Prospect Loan, net	67,204			67,967
Less current portion	—			—
Total long term portion	$	67,204		$	67,967